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Alliant Energy (LNT) Unit Announces Pricing of $300M Debt
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Alliant Energy Corporation’s (LNT - Free Report) unit, Interstate Power and Light Company (“IPL”) announced that it has priced the public offering of $300 million senior debentures. These debentures have an interest rate of 3.7% and will be due on Sep 15, 2046. It is a common practice among utilities to take advantage of a low interest rate environment to refinance existing debt.
The decision to refinance existing debts will extend some of its debt repayment schedules by nearly three decades.
Utilization of Net Proceeds
IPL plans to utilize net proceeds of nearly $295.3 million, before expenses, to lower outstanding capital under its receivables purchase and sale program, reduce commercial paper classified as long-term debt and/or for general corporate purposes.
The company may also need some funds to upgrade its existing coal-based facilities. Alliant Energy has plans to upgrade some of its coal facilities to meet environmental norms and aims to lower carbon emission from its generating plants by 40% in 2030 from the 2005 levels.
The current debt-to-capital ratio of Alliant Energy is 47.35%, a touch lower than the industry peer average of 49.04%, but higher than the S&P 500 peer average of 42.01%. This regulated electric and natural gas utility joined the S&P 500 index on Jun 30, 2016, replacing AGL Resources Inc.
Long-Term Prospects
Alliant Energy’s future bottom-line growth appears promising due to strong state economies in its service areas and compelling prospects for new electric generation capacity. Its geographic location and favorable regulatory developments bode well for long-term earnings growth. The company currently targets annual earnings growth of 5–7% over the long run.
Zacks Rank & Key Picks
Alliant Energy currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the utility-electric power industry are Spark Energy Inc. , American Electric Power Co., Inc. (AEP - Free Report) and DTE Energy Company (DTE - Free Report) . Spark Energy sports a Zacks Rank #1 (Strong Buy), while American Electric Power and DTE Energy currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Alliant Energy (LNT) Unit Announces Pricing of $300M Debt
Alliant Energy Corporation’s (LNT - Free Report) unit, Interstate Power and Light Company (“IPL”) announced that it has priced the public offering of $300 million senior debentures. These debentures have an interest rate of 3.7% and will be due on Sep 15, 2046. It is a common practice among utilities to take advantage of a low interest rate environment to refinance existing debt.
The decision to refinance existing debts will extend some of its debt repayment schedules by nearly three decades.
Utilization of Net Proceeds
IPL plans to utilize net proceeds of nearly $295.3 million, before expenses, to lower outstanding capital under its receivables purchase and sale program, reduce commercial paper classified as long-term debt and/or for general corporate purposes.
The company may also need some funds to upgrade its existing coal-based facilities. Alliant Energy has plans to upgrade some of its coal facilities to meet environmental norms and aims to lower carbon emission from its generating plants by 40% in 2030 from the 2005 levels.
ALLIANT ENGY CP Price
ALLIANT ENGY CP Price | ALLIANT ENGY CP Quote
Debt Position
The current debt-to-capital ratio of Alliant Energy is 47.35%, a touch lower than the industry peer average of 49.04%, but higher than the S&P 500 peer average of 42.01%. This regulated electric and natural gas utility joined the S&P 500 index on Jun 30, 2016, replacing AGL Resources Inc.
Long-Term Prospects
Alliant Energy’s future bottom-line growth appears promising due to strong state economies in its service areas and compelling prospects for new electric generation capacity. Its geographic location and favorable regulatory developments bode well for long-term earnings growth. The company currently targets annual earnings growth of 5–7% over the long run.
Zacks Rank & Key Picks
Alliant Energy currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the utility-electric power industry are Spark Energy Inc. , American Electric Power Co., Inc. (AEP - Free Report) and DTE Energy Company (DTE - Free Report) . Spark Energy sports a Zacks Rank #1 (Strong Buy), while American Electric Power and DTE Energy currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>