UBS Upgrades Xcel Energy (XEL) to Buy

UBS analyst William Appicelli upgraded Xcel Energy (NASDAQ: XEL) from Neutral to Buy with a price target of $89.00 (from $81.00).

The analyst comments: "We raise XEL to Buy from Neutral for its high quality, full regulated 9% EPS growth rate and increasing data center load growth trends that we think look unrecognized with the stock trading at a depressed 4% discount to the Utility group. At $79.68, we estimate XEL is pricing in sub 7% EPS growth; a full 200bps below our forecasts. XEL raised the data center high probability load upside to 4 GW from 2 GW on the recent year-end call and has increasing investment opportunities from SPP transmission and state resource plans led by 2.1 GW in Colorado. Resolution of the legacy Smokehouse fire liability in Texas is likely a small outlay <$0.1 bln. We raise our price target to $89 from $81 while maintaining the 7% Utility group premium, representing 2 P/E turns of re-rating; we see potential further upside to a 12% average premium since 2020."

For an analyst ratings summary and ratings history on Xcel Energy click here. For more ratings news on Xcel Energy click here.

Shares of Xcel Energy closed at $78.98 yesterday.

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