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PPL Corporation (PPL) - free report >>
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PPL Corporation (PPL) - free report >>
Duke Energy Corporation (DUK) - free report >>
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PPL Rides on Capital Investment Plans & Focus on Clean Energy
PPL Corporation’s (PPL - Free Report) planned investments in strengthening infrastructure, increased focus on cleaner energy generation and growth in domestic operation are likely to enhance its existing operations.
The Zacks Consensus Estimate for the company’s 2021 and 2022 earnings is pegged at $1.63 and $2.02 per share, respectively, which has remained stable in the past 60 days. In the past month, shares of this currently Zacks Rank #3 (Hold) company have lost 2.2% compared with the industry’s fall of 5.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
One-Month Price Performance
Image Source: Zacks Investment Research
What’s Driving the Stock?
PPL Corporation’s capital investment plan primarily focuses on its infrastructure-construction projects for generation, transmission and distribution. The utility expects to invest $7.8 billion from 2021 to 2025, which will expand the rate base from $20.1 billion in 2021 to $20.9 billion in 2025.
The company divested its U.K. utility business to National Grid in June 2021. In the first quarter of 2021, it inked a deal to buy the Narragansett Electric Company, a Rhode Island-based utility business, from National Grid. The buyout is expected to be completed by March 2022. These deals will simplify the company’s business mix along with providing it with greater financial flexibility to prevent exposure to foreign currency risks.
PPL Corporation aims to reduce 80% carbon emission within 2050 from its 2010-levels by introducing carbon capture technology and adding renewable sources to its energy-generation portfolio. Apart from the company, utilities like Duke Energy (DUK - Free Report) , DTE Energy (DTE - Free Report) and Avista Corporation (AVA - Free Report) have plans in place to lower carbon footprint for a pollution-free environment.
Woes
Unplanned outages at power plants may increase PPL Corporation’s expenses. Pollution-control execution costs and legal costs may weigh on its finances. Stringent laws and regulations may hurt the company’s revenues.