Wells Fargo Upgrades NSTAR (NST) to Outperform
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Price: $47.65 --0%
Rating Summary:
3 Buy, 1 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
Rating Summary:
3 Buy, 1 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
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Wells Fargo upgraded NSTAR (NYSE: NST) from Market Perform to Outperform, increasing valuation range to $50-51/share from $47-48.
Wells analyst says, "We are raising our rating on shares of Northeast Utilities (NYSE: NU) and NSTAR (NST) to Outperform from Market Perform. Since July 2011, shares of NU have fallen 4.1%, materially underperforming the S&P Utilities, which is up 2.4%. As a result, shares now trade in line with the Regulated Electric peer group multiples on our 2012-2014 estimated EPS of $2.44, $2.60 and $2.75. This compares with an average premium of 5-10% over the past 5 years due to above average growth prospects and higher relative percentage of FERC-regulated transmission earnings."
We attribute the recent underperformance and erosion of the P/E multiple premium to growing regulatory concerns related to the pending merger with NSTAR. The merger, which was announced on October 18, 2010, was originally expected to close in mid-to-late 2011. The hang-up is Massachusetts, which is the critical path for merger approval and has proven to be a much more difficult road to navigate than expected."
For an analyst ratings summary and ratings history on NSTAR click here. For more ratings news on NSTAR click here.
Shares of NSTAR closed at $44.90 yesterday.
Wells analyst says, "We are raising our rating on shares of Northeast Utilities (NYSE: NU) and NSTAR (NST) to Outperform from Market Perform. Since July 2011, shares of NU have fallen 4.1%, materially underperforming the S&P Utilities, which is up 2.4%. As a result, shares now trade in line with the Regulated Electric peer group multiples on our 2012-2014 estimated EPS of $2.44, $2.60 and $2.75. This compares with an average premium of 5-10% over the past 5 years due to above average growth prospects and higher relative percentage of FERC-regulated transmission earnings."
We attribute the recent underperformance and erosion of the P/E multiple premium to growing regulatory concerns related to the pending merger with NSTAR. The merger, which was announced on October 18, 2010, was originally expected to close in mid-to-late 2011. The hang-up is Massachusetts, which is the critical path for merger approval and has proven to be a much more difficult road to navigate than expected."
For an analyst ratings summary and ratings history on NSTAR click here. For more ratings news on NSTAR click here.
Shares of NSTAR closed at $44.90 yesterday.
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