For Immediate Release
Chicago, IL – September 31, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Entergy Corporation (ETR - Free Report) , American Electric Power Company, Inc. (AEP - Free Report) and CenterPoint Energy, Inc. (CNP - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Hurricane Laura Devastates Louisiana: 3 Stocks in Focus
Hurricane Laura, which made landfall on Aug 27 near the Texas-Louisiana border as a Category 4 storm, has left a path of destruction in its wake. As the wind gusts from this catastrophic storm caused widespread structural damage, particularly in the state of Louisiana, more than 843,000 customers in Texas and Louisiana suffered a power outage yesterday evening, according to PowerOutages.us.
Fortunately, the impact of the hurricane was not that grave in Texas, as shortly after making landfall it weakened. Nevertheless, the storm did cause power outages and property damages in the state. In particular, as stated by Texas governor Greg Abbott, some of the worst damage was witnessed in the state’s Orange County. Reportedly, this entire county went out of power in the aftermath of the storm.
Impact of Hurricanes on Utilities
Per data from the U.S. Energy Information Administration (EIA), Louisiana has the second-highest per capita residential sector electricity consumption in the United States. On the other hand, Texas produces more electricity than any other state in the nation, generating almost twice as much as Florida, the second-highest electricity-producing state. These have made Texas and Louisiana most sought-after locations for utility players to expand their business.
Now, catastrophic storms like Laura accompanied by wind gusts, snap and topple electricity poles, wires and nearby trees. Utilities’ operations come to a halt while the resultant damages push up costs for restoration. Such catastrophic storms also tend to damage natural gas pipelines.
Utilities in Focus
Knowing how much rampage a hurricane like Laura with expected wind speed of up to 140 mph can cause, utilities in the Gulf Coast region took measures beforehand. Per a report by S&P Global Platts, more than 13,000 technicians were mobilized on Aug 26 to prepare for power restoration in the Louisiana-Texas Gulf Coast area. Post the storm, these utilities are working relentlessly to bring back power. Below we have mentioned three such utilities:
Entergy Corp’s spokesman Neal Kirby on Aug 25 had said that the company has almost 7,400 people preparing to restore service. As Hurricane Laura traveled toward Arkansas on Aug 27, more than 13,000 restoration workers of this Zacks Rank #3 (Hold) company from 27 states remained focused on Texas and Louisiana, helping restoration work.
Southwestern Electric Power Company (SWEPCO), a unit of American Electric Power, on Aug 26 had more than 1,600 people, including more than 1,000 contractors, ready to clear away debris and restore service in the areas of Arkansas, East Texas and Louisiana that might be affected by the storm. On Aug 27, this Zacks Rank #3 company arranged for 2,500 workers to support more than 300 SWEPCO employees in power restoration. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Although CenterPoint Energy did not specify the number of workers it has deployed for the restoration work, it brought in additional company crews from Mississippi and Houston to help handle emergencies and restore natural gas service. This Zacks Rank #3 company continues to monitor the storm’s trajectory as it moves through its service territories of Arkansas, Indiana and Ohio.
Laura is the strongest storm to hit Louisiana since 1856. Though it has weakened, it continues to bring destructive winds and heavy rainfall entering Arkansas. Portions of Mississippi are also expected to be affected by the storm’s outer bands.
It is imperative to mention in this context that given the intensity of this storm and the need for crews to follow COVID-19 precautionary measures, some affected areas may experience outages for weeks. Moreover, flash flooding following the storm as well as blocked access may delay restoration work. Therefore, the storm’s impact on the aforementioned utilities might be worse than expected.
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