Analyzing Eversource Energy’s Market Position and Performance
Based in Springfield, Massachusetts, Eversource Energy (ES) is a key player in the energy delivery sector, providing electricity and natural gas to a variety of customers, including residential, commercial, and industrial clients. With a market cap of $21.3 billion, Eversource operates through several segments: Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution.
Understanding Eversource’s Customer Base
Eversource fits into the “large-cap” category, defined as companies worth $10 billion or more. The utility company serves around 1.8 million customers in Massachusetts, comprising nearly 1.47 million electric customers across 140 communities, 639,000 gas customers in 117 communities, and 8,800 water customers in five communities.
Recent Stock Performance
Currently, ES is trading 15.2% below its 52-week high of $69.01, reached on Sep. 5. Over the past three months, Eversource shares have declined by nearly 14.3%, underperforming the wider S&P 500 Index, which has seen a 7.4% gain during the same period.
Looking back over the longer term, ES has also experienced a nearly 5.4% decline in the past year, significantly trailing the S&P 500’s impressive 28.2% returns. Year-to-date, Eversource shares are down 5.2%, a stark contrast to the S&P 500’s gains of almost 26.9% over the same time frame.
Trend Analysis
To further illustrate its downturn, ES has been trading below its 200-day moving average since early December and has remained under its 50-day moving average since late November.
Earnings Report Summary
Following its Q3 earnings report on Nov. 4, Eversource shares fell 2.1%, despite an earnings performance that surpassed expectations. The company reported adjusted earnings of $1.13 per share, exceeding Wall Street’s forecasts of $1.04, and this marked a 16.5% increase from the previous year. Additionally, revenue increased by 9.7% year-over-year to $3.06 billion, slightly above predictions.
However, a reported net loss of $118.1 million for Q3, largely due to a $524 million after-tax loss from the sale of its offshore wind business, may have shaken investor confidence. The company has also lowered its adjusted earnings per share estimate for the full year 2024 to a range between $4.52 and $4.60 because of higher interest expenses, which may further influence its stock price.
Comparative Analysis with Rivals
When compared to its competitor Duke Energy Corporation (DUK), which has gained nearly 11.7% over the last year and 11.2% year-to-date, Eversource’s struggles become more pronounced.
Future Outlook
Despite recent challenges, analysts continue to hold a moderately optimistic view of Eversource Energy’s future. The stock has a consensus rating of “Moderate Buy” from the 20 analysts covering it, and the average price target sits at $71.44, indicating a potential upside of 22.1% compared to its current trading levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
