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Reasons to Add Consolidated Edison (ED) to Your Portfolio Now
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Consolidated Edison’s (ED - Free Report) ongoing systematic capital investment plan to strengthen infrastructure, emission-reduction plans and efficient management of debts are likely to drive its performance in the long run.
The Zacks Consensus Estimate for 2022 earnings has moved up by 0.4% in the past 60 days to $4.47 per share. The Zacks Consensus Estimate for 2023 earnings has moved up by 2% in the past 60 days to $4.79 per share.
Consolidated Edison’s long-term (three to five years) earnings growth is projected at 2%.
Consolidated Edison delivered an average earnings surprise of 1.4% in the last four quarters.
Dividend
Consolidated Edison has a long history of dividend payments and has paid dividends to shareholders consecutively since 1972. ED continues to target a dividend payout ratio of nearly 60% to 70% of its adjusted earnings. The new dividend for 2022 is $3.16 per share, which represents an annualized increase of 6 cents over the previous dividend of $3.10 per share.
Currently, Consolidated Edison has a dividend yield of 3.3% compared with the Zacks S&P 500 composite's average of 1.5%.
Stable Investments & Emissions Reduction
Consolidated Edison continues to follow a systematic capital investment plan for infrastructure development and to maintain the reliability of its electric, gas and steam delivery systems. Through the capital expenditure plan of $15.7 billion for the 2022-2024 period, Consolidated Edison aims to add renewables, strengthen its infrastructure and enhance operations, primarily in the electric transmission business.
Consolidated Edison also aims at creating a 100% clean energy electric grid by 2040. ED spent $298 million in renewable electric projects and plans to invest $1.2 billion in clean energy projects during the 2022-2024 period. Such solid investments will further boost Consolidated Edison’s renewable energy portfolio.
Debt Position
The Debt-to-Capital ratio of Consolidated Edison at the end of the fourth quarter of 2021was 53.1% compared with the industry average of 56.5%. It indicates that ED is using comparatively lower debts to manage the business compared with its peers.
The times interest earned ratio of Consolidated Edison at the end of the fourth quarter of 2021 was 2.5, which improved sequentially from 2.2 in the third quarter of 2021, thereby indicating that the company has enough financial strength to meet its near-term obligations.
Price Performance
In the past six months, Consolidated Edison has rallied 29.3% compared with the industry’s 12.5% growth.
The long-term earnings growth of Ameren, PNM Resources and WEC Energy is projected at 7.2%, 5% and 6%, respectively.
The Zacks Consensus Estimate for 2022 earnings per share of Ameren, PNM Resources and WEC Energy has moved up 5.47%, 4.08% and 4.87%, respectively, year over year.
In the past three months, AEE, PNM and WEC shares have surged 7.6%, 3.4% and 4.7%, respectively.
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Reasons to Add Consolidated Edison (ED) to Your Portfolio Now
Consolidated Edison’s (ED - Free Report) ongoing systematic capital investment plan to strengthen infrastructure, emission-reduction plans and efficient management of debts are likely to drive its performance in the long run.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) stock a strong investment pick at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Growth Projection & Surprise History
The Zacks Consensus Estimate for 2022 earnings has moved up by 0.4% in the past 60 days to $4.47 per share. The Zacks Consensus Estimate for 2023 earnings has moved up by 2% in the past 60 days to $4.79 per share.
Consolidated Edison’s long-term (three to five years) earnings growth is projected at 2%.
Consolidated Edison delivered an average earnings surprise of 1.4% in the last four quarters.
Dividend
Consolidated Edison has a long history of dividend payments and has paid dividends to shareholders consecutively since 1972. ED continues to target a dividend payout ratio of nearly 60% to 70% of its adjusted earnings. The new dividend for 2022 is $3.16 per share, which represents an annualized increase of 6 cents over the previous dividend of $3.10 per share.
Currently, Consolidated Edison has a dividend yield of 3.3% compared with the Zacks S&P 500 composite's average of 1.5%.
Stable Investments & Emissions Reduction
Consolidated Edison continues to follow a systematic capital investment plan for infrastructure development and to maintain the reliability of its electric, gas and steam delivery systems. Through the capital expenditure plan of $15.7 billion for the 2022-2024 period, Consolidated Edison aims to add renewables, strengthen its infrastructure and enhance operations, primarily in the electric transmission business.
Consolidated Edison also aims at creating a 100% clean energy electric grid by 2040. ED spent $298 million in renewable electric projects and plans to invest $1.2 billion in clean energy projects during the 2022-2024 period. Such solid investments will further boost Consolidated Edison’s renewable energy portfolio.
Debt Position
The Debt-to-Capital ratio of Consolidated Edison at the end of the fourth quarter of 2021was 53.1% compared with the industry average of 56.5%. It indicates that ED is using comparatively lower debts to manage the business compared with its peers.
The times interest earned ratio of Consolidated Edison at the end of the fourth quarter of 2021 was 2.5, which improved sequentially from 2.2 in the third quarter of 2021, thereby indicating that the company has enough financial strength to meet its near-term obligations.
Price Performance
In the past six months, Consolidated Edison has rallied 29.3% compared with the industry’s 12.5% growth.
Image Source: Zacks Investment Research
Other Stocks to Consider
Other similar-ranked stocks from the same industry include Ameren (AEE - Free Report) , PNM Resources (PNM - Free Report) and WEC Energy Group (WEC - Free Report) .
The long-term earnings growth of Ameren, PNM Resources and WEC Energy is projected at 7.2%, 5% and 6%, respectively.
The Zacks Consensus Estimate for 2022 earnings per share of Ameren, PNM Resources and WEC Energy has moved up 5.47%, 4.08% and 4.87%, respectively, year over year.
In the past three months, AEE, PNM and WEC shares have surged 7.6%, 3.4% and 4.7%, respectively.