Analyst Sarah Akers of Wells Fargo assigned a Buy rating on Evergy (EVRG – Research Report), with a price target of $57.00.
Sarah Akers has given his Buy rating due to a combination of factors that suggest Evergy’s stock presents a favorable risk/reward profile. Notably, shares are trading at approximately a 13% price-to-earnings (P/E) discount compared to its peers, which may indicate an undervaluation. Additionally, there is optimism surrounding potential legislative developments in Kansas that could lead to positive adjustments for the company. Akers also acknowledges that while a valuation discount might be justified due to challenging regulatory conditions in Kansas and slightly below-average earnings per share (EPS) growth, the current level of the discount seems overstated.
Akers’s outlook is further supported by Evergy’s solid guidance for 2024, with initiated EPS guidance indicating stability and aligning closely with consensus estimates. The company’s upward revision of its five-year capital expenditure plan by 7.7% suggests a strong commitment to new generation resources and supports a 6% rate base growth. While Evergy operates in a challenging regulatory environment, Akers sees the ongoing legislative session in Kansas and a pending rate case in Missouri as potential catalysts for more constructive regulatory outcomes, thereby laying the groundwork for a Buy rating despite lowering the price target slightly due to lower peer group multiples.
EVRG’s price has also changed moderately for the past six months – from $57.080 to $49.540, which is a -13.21% drop .
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Evergy (EVRG) Company Description:
Evergy, Inc. is a holding company, which engages in the provision of electricity through its subsidiaries. It focuses on the regulation of electric utilities and development of electric transmission projects. The company was founded in 2017 and is headquartered in Kansas City, MO.
Read More on EVRG:
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