BMO Capital has maintained its Outperform rating on Duke Energy (NYSE: NYSE:) with a steady price target of $126.00.
The firm adjusted its third-quarter earnings estimate for Duke Energy to $1.68, which is a decrease from the $1.94 reported in the same quarter of the previous year.
The year-over-year negative comparison of $0.25 is mainly attributed to timing issues related to the reversal of agility initiatives, the favorable weather conditions in the third quarter of 2023, and costs associated with Hurricane Debby.
For the fourth quarter of 2024, BMO Capital revised its earnings estimate for Duke Energy upward to $1.73 from $1.51 in the fourth quarter of 2023. This updated estimate takes into account expected normalized weather conditions, quarterly-weighted Gas Utilities and Infrastructure (U&I) contributions, annualized rate relief, and an increase in interest expenses.
Furthermore, the full-year 2024 earnings estimate for Duke Energy has been increased to $6.03 from the previous estimate of $5.97. The revision reflects the analyst’s expectations for the company’s performance based on the factors mentioned for the third and fourth quarters.
BMO Capital’s reaffirmation of the Outperform rating and the $126 price target indicates the firm’s continued confidence in Duke Energy’s stock performance.
In other recent news, Duke Energy has been the focus of several significant developments. Edward Jones maintained its Buy rating on Duke Energy shares, highlighting the company’s above-average dividend yield and substantial capital investment plans.
BMO Capital Markets raised the price target for Duke Energy from $120 to $126, maintaining an Outperform rating following a recent settlement agreement involving Piedmont Natural Gas, a subsidiary of Duke Energy. The agreement allows for a net rate increase of approximately $98 million.
Additionally, Duke Energy secured a $57 million grant from the U.S. Department of Energy for the reconstruction of a key power line in North Carolina, a project expected to improve grid reliability and create around 550 jobs. Furthermore, the company successfully issued $1 billion in junior subordinated debentures as part of its capital management strategy.
Despite these positive strides, Mizuho Securities maintained a neutral stance due to concerns over industrial load forecasts and potential policy changes. Duke Energy’s comprehensive rate plan in Florida was approved, projected to save residential customers about 5% on their electric bills by January 2025.
InvestingPro Insights
In light of the recent analysis by BMO Capital, it’s important to consider additional metrics that may provide a broader perspective on Duke Energy (NYSE:DUK). InvestingPro data shows a current market capitalization of $89.75 billion, underscoring the company’s significant presence in the Electric Utilities industry. The P/E ratio stands at 21.4, with an adjusted P/E ratio for the last twelve months as of Q2 2024 at 19.24, suggesting a potentially favorable valuation relative to earnings.
InvestingPro Tips highlight that while Duke Energy operates with a significant debt burden, it has demonstrated a commitment to returning value to shareholders by raising its dividend for 16 consecutive years, and it has maintained dividend payments for 54 consecutive years. This consistency is reflected in the dividend yield of 3.6% as of August 2024. Moreover, the company’s stock generally trades with low price volatility, which might appeal to investors seeking stability.
For investors interested in Duke Energy’s stock performance, it’s worth noting that the company has seen a strong return over the last three months, with a 17.35% price total return, and it’s trading near its 52-week high, at 98.23% of the peak price. The company’s next earnings date is set for October 31, 2024, which could provide further insights into its financial health and performance.
For further information and additional InvestingPro Tips related to Duke Energy, investors can explore https://www.investing.com/pro/DUK, which lists 11 tips including analysts’ predictions of profitability for the year and a record of being profitable over the last twelve months.
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