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Investing.com - Goldman Sachs upgraded Duke Energy (NYSE:DUK) from Neutral to Buy on Wednesday, raising its price target to $132.00 from its previous target.
The investment bank cited becoming "more constructive" on Duke Energy’s outlook from multiple perspectives, including load growth, generation capital expenditure, regulatory environment, and balance sheet position. Goldman Sachs views the valuation as "more compelling" since the stock trades at a discount compared to other premium utilities.
Duke Energy screens positively among Goldman Sachs’ regulated utilities coverage, with one of the highest expected growth rates through 2029. This growth is supported by robust load growth in the Carolinas region and the company’s ability to bring gas generation online faster than competitors due to its partnership with GEV.
The investment firm has also become more positive on Duke Energy’s regulatory perspective, noting the company has received favorable outcomes on rate cases in the Carolinas and Florida, along with establishing a framework for large load customers.
Goldman Sachs highlighted that Duke Energy’s valuation is attractive, with the stock trading at a 6% price-to-earnings FY2 discount versus premium utility peers based on consensus numbers. The firm raised its target FY2 multiple for Duke Energy to 19x from 18x, resulting in the new $132 price target, which represents a potential 17% total return.
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