Eversource Energy: A Strong Utility Player with Unique Challenges
Springfield, Massachusetts-based Eversource Energy (ES) is a public utility holding company delivering energy services. With a market capitalization of $22.4 billion, the company supplies electricity to customers in Connecticut, New Hampshire, and western Massachusetts, while also distributing natural gas throughout Connecticut.
As a large-cap stock, defined as companies valued at $10 billion or more, ES exemplifies the stability and influence characteristic of this category. Its rate-regulated business model generates a reliable revenue stream across its electric, gas, and water distribution segments. This regulatory framework supports predictable cost recovery and investment returns, bolstering the company’s financial stability. Recently, Eversource chose to divest from offshore wind investments, signalling a strategic focus on optimizing its asset portfolio around core regulated businesses.
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Despite its strengths, Eversource has experienced a decline, slipping 11.8% from its 52-week high of $69.01, achieved on September 5, 2024. However, the stock gained 6.3% over the past three months, outperforming the Nasdaq Composite’s ($NASX) 9.2% dip in the same period.
Long-term performance shows Eversource shares rising 6% year-to-date, a slight edge over NASX’s YTD declines of 5.8%. Over the past year, however, ES saw a modest 5.1% gain, falling short of NASX’s impressive 10.7% returns.
To further illustrate its trading health, Eversource has remained above its 50-day moving average since early February. Conversely, it has been trading below its 200-day moving average since early December 2024, indicating some market fluctuations.
On February 11, Eversource shares closed up more than 1% following its Q4 earnings report. The utility posted an adjusted earnings per share (EPS) of $1.01, surpassing Wall Street’s expectation of $0.99. Additionally, the company reported revenues of $3 billion, exceeding analyst forecasts of $2.8 billion.
In comparison, Eversource’s rival, PPL Corporation (PPL), has outperformed with a YTD gain of 7.2% and an impressive 28.4% return over the past year.
Wall Street analysts express moderate optimism regarding Eversource’s future. The stock holds a consensus “Moderate Buy” rating from 20 analysts, and the average price target of $69.25 indicates a potential upside of 13.8% from current levels.
On the date of publication, Neha Panjwani did not hold (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 details, please view the Barchart Disclosure Policy here.
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
