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Reasons to Add New Jersey Resources (NJR) to Your Portfolio
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New Jersey Resources (NJR - Free Report) provides reliable energy services to its expanding customer base. Given its earnings growth opportunities and strong return on equity (ROE), NJR makes for a solid investment option in the utility sector.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for fiscal 2024 earnings per share (EPS) has moved up 6.1% in the past 90 days to $2.94.
New Jersey Resources delivered an average earnings surprise of 105.1% in the last four quarters.
Return on Equity
ROE indicates how efficiently a company has been utilizing the funds to generate higher returns. Currently, New Jersey Resources’ ROE is 11.13%, higher than the industry’s average of 9.98%. This indicates that the company has been utilizing the funds more constructively than its peers in the utility gas distribution industry.
Dividend Growth
NJR has been increasing shareholders' value by paying dividends. Currently, its quarterly dividend is 42 cents per share, resulting in an annualized dividend of $1.68 per share, up 7.7% from the previous figure of $1.56. Its current dividend yield is 3.91%, better than the Zacks S&P 500 Composite’s 1.3%.
Systematic Investments & Customer Growth
New Jersey Resources makes consistent investments to upgrade and maintain its existing infrastructure. The idea is to provide 24/7 reliable services to its customers. The company expects capital investments in the range of $608-$743 million and $578-$742 million for fiscal 2024 and fiscal 2025, respectively.
The company added 2,129 new customers during the first quarter of fiscal 2024, compared with 2,132 in the first quarter of fiscal 2023. NJR expects these new customers to contribute approximately $1.9 million of incremental utility gross margin on an annualized basis.
Price Performance
In the past month, the stock has lost 1.4% compared with the sector’s 5.8% decline.
ATO’s long-term (three to five years) earnings growth rate is 7%. The company delivered an average earnings surprise of 1.2% in the last four quarters.
MDU’s long-term earnings growth rate is 6%. The Zacks Consensus Estimate for MDU’s 2024 EPS is on par with the bottom line reported in 2023.
NI’s long-term earnings growth rate is 6%. The company delivered an average earnings surprise of 5.6% in the last four quarters.
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Reasons to Add New Jersey Resources (NJR) to Your Portfolio
New Jersey Resources (NJR - Free Report) provides reliable energy services to its expanding customer base. Given its earnings growth opportunities and strong return on equity (ROE), NJR makes for a solid investment option in the utility sector.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for fiscal 2024 earnings per share (EPS) has moved up 6.1% in the past 90 days to $2.94.
New Jersey Resources delivered an average earnings surprise of 105.1% in the last four quarters.
Return on Equity
ROE indicates how efficiently a company has been utilizing the funds to generate higher returns. Currently, New Jersey Resources’ ROE is 11.13%, higher than the industry’s average of 9.98%. This indicates that the company has been utilizing the funds more constructively than its peers in the utility gas distribution industry.
Dividend Growth
NJR has been increasing shareholders' value by paying dividends. Currently, its quarterly dividend is 42 cents per share, resulting in an annualized dividend of $1.68 per share, up 7.7% from the previous figure of $1.56. Its current dividend yield is 3.91%, better than the Zacks S&P 500 Composite’s 1.3%.
Systematic Investments & Customer Growth
New Jersey Resources makes consistent investments to upgrade and maintain its existing infrastructure. The idea is to provide 24/7 reliable services to its customers. The company expects capital investments in the range of $608-$743 million and $578-$742 million for fiscal 2024 and fiscal 2025, respectively.
The company added 2,129 new customers during the first quarter of fiscal 2024, compared with 2,132 in the first quarter of fiscal 2023. NJR expects these new customers to contribute approximately $1.9 million of incremental utility gross margin on an annualized basis.
Price Performance
In the past month, the stock has lost 1.4% compared with the sector’s 5.8% decline.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same sector are Atmos Energy (ATO - Free Report) , MDU Resources (MDU - Free Report) and NiSource (NI - Free Report) , each holding a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ATO’s long-term (three to five years) earnings growth rate is 7%. The company delivered an average earnings surprise of 1.2% in the last four quarters.
MDU’s long-term earnings growth rate is 6%. The Zacks Consensus Estimate for MDU’s 2024 EPS is on par with the bottom line reported in 2023.
NI’s long-term earnings growth rate is 6%. The company delivered an average earnings surprise of 5.6% in the last four quarters.