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Alliant Energy Corp (NASDAQ:LNT), a utility company with a market capitalization of $17 billion currently trading at a premium to its InvestingPro Fair Value, has entered into a $300 million credit agreement with U.S. Bank National Association and other lenders, according to a recent SEC filing. The agreement, signed today, provides a one-year term loan with an optional $100 million incremental facility.
The Madison, Wisconsin-based utility company will use the funds to refinance existing debt and for general corporate purposes. The new credit facility, which matures on March 2, 2026, is guaranteed by Alliant Energy and amends a previous agreement. With total debt of $10.6 billion and a current ratio of 0.44, InvestingPro analysis indicates the company’s short-term obligations exceed its liquid assets.
Under the terms, Alliant Energy must maintain a debt-to-capital ratio below 65%. The agreement also restricts Alliant Energy and its subsidiaries from incurring certain additional liens, with specified exceptions. The company is required to apply proceeds from asset sales over a certain threshold towards reducing debt.
This financial move comes with standard covenants and events of default, including a cross-default provision for debts exceeding $100 million. If Alliant Energy or its domestic subsidiaries default on such obligations, lenders may demand immediate payment of the credit facility.
The details of the agreement are outlined in Exhibit 10.1 of the SEC filing, which serves as the source for this information.
In other recent news, Alliant Energy reported fourth-quarter earnings that surpassed analyst expectations, with adjusted earnings per share at $0.70 compared to the consensus of $0.68. However, the company’s revenue for the same period fell short, reaching $976 million against the anticipated $1.11 billion. For the full year 2024, Alliant Energy achieved adjusted earnings of $3.04 per share, an increase from $2.82 in 2023, while annual revenue slightly declined to $3.98 billion from $4.03 billion the previous year. The company has reaffirmed its 2025 earnings guidance, projecting earnings per share between $3.15 and $3.25, aligning closely with the analyst consensus of $3.20.
BMO Capital Markets has raised its price target for Alliant Energy from $60.00 to $66.00, maintaining a Market Perform rating on the stock. This adjustment follows the company’s successful navigation of challenging weather conditions and reaching an agreement for a data center in Wisconsin. Alliant Energy plans to update its capital plan in early 2025 to accommodate the additional load from this new data center. The company completed significant investments in solar generation in 2024, adding 1,500 megawatts. BMO Capital noted the potential for increased earnings per share and multiple expansion due to Alliant Energy’s economic development efforts and low regulatory risk.
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