Wells Fargo analyst Neil Kalton maintained a Hold rating on Avangrid (AGR – Research Report) yesterday and set a price target of $35.00.
Neil Kalton has given his Hold rating due to a combination of factors including Avangrid’s historical difficulty in achieving its financial targets and the recent shift in the company’s strategy. Although there has been an improvement in Avangrid’s adjusted earnings per share for 2023, which slightly exceeded Kalton’s expectations, the company’s performance still fell short of its initial guidance range. This performance discrepancy, despite excluding the impact of potential renewable asset sales and partial year results from PNM, indicates that Avangrid’s financial outcomes have room for enhancement.
Furthermore, Avangrid’s forward-looking strategies provide some optimism. The focus on robust organic investment opportunities, particularly the $8.7 billion in approved investments in New York, and the construction of approximately 1 gigawatt of onshore renewable projects are positive developments. Management’s pursuit of wind repowering opportunities and new renewable origination also suggests potential for future growth. However, Kalton maintains his estimates for 2024 and 2025 earnings per share, implying a cautious outlook on the company’s ability to capitalize on these opportunities and translate them into significant earnings growth in the near term.
AGR’s price has also changed slightly for the past six months – from $34.400 to $31.870, which is a -7.35% drop .
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Avangrid (AGR) Company Description:
Avangrid, Inc. is a diversified energy and utility company. It operates regulated utilities and electricity generation assets through two primary lines of business: Avangrid Networks and Avangrid Renewables. The Avangrid Networks includes eight electric and natural gas utilities. The Avangrid Renewables provides electricity through wind power, across the United States. The company was founded in 1852 and is headquartered in Orange, CT.
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