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Reasons to Add New Jersey Resources Stock to Your Portfolio Now
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New Jersey Resources (NJR - Free Report) continues to benefit from its investments in infrastructure that help serve its expanding customer base more efficiently. 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.
NJR’s Growth Projections
The Zacks Consensus Estimate for fiscal fourth-quarter 2024 earnings per share (EPS) has moved up 3.5% in the past 90 days to 89 cents.
The Zacks Consensus Estimate for sales is pinned at $406.97 million, indicating year-over-year growth of 22.8%.
NJR’s Return on Equity
ROE indicates how efficiently a company has been utilizing the funds to generate higher returns. Currently, New Jersey Resources’ ROE is 11.06%, higher than the industry’s average of 9.29%. This indicates that the company has been utilizing the funds more constructively than its peers in the utility gas distribution industry.
NJR’s Solvency
The time-to-interest earned ratio at the end of the fiscal third quarter was 3.3. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.
NJR’s Dividend Growth
New Jersey Resources has been increasing shareholders' value by paying dividends. NJR has paid quarterly dividends continuously since its inception in 1952, and has raised the dividend every year for the past 29 years. In September 2024, the company’s board of directors approved a 7.1% increase in quarterly dividend rate. The new quarterly dividend is 45 cents per share, resulting in an annualized dividend of $1.80 per share compared with the previous figure of $1.68. The company’s current dividend yield is 3.79%, better than the Zacks S&P 500 composite’s 1.19%.
NJR’s Systematic Investments & Customer Growth
New Jersey Resources makes consistent investments to upgrade and maintain its existing infrastructure. The idea is to provide reliable services to its customers around the clock. The company expects capital expenditures to be in the range of $495-$675 million for fiscal 2025.
The company added 5,939 new customers during the first nine months of fiscal 2024 compared with 5,892 in the corresponding period of fiscal 2023. It expects these new customers to contribute nearly $5.1 million of incremental utility gross margin on an annualized basis.
NJR’s Price Performance
In the past month, shares of the company have risen 3.3% against the sector’s 1.1% decline.
OGS’ long-term earnings growth rate is 5%. The Zacks Consensus Estimate for OGS’s fourth-quarter sales indicates an increase of 8.9% from the year-ago’s registered figure.
ATO’s long-term earnings growth rate is 7%. The company delivered an average earnings surprise of 3.4% in the past four quarters.
NI’s long-term earnings growth rate is 6.95%. The Zacks Consensus Estimate for NI’s 2024 EPS indicates year-over-year growth of 8.1%.
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Reasons to Add New Jersey Resources Stock to Your Portfolio Now
New Jersey Resources (NJR - Free Report) continues to benefit from its investments in infrastructure that help serve its expanding customer base more efficiently. 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.
NJR’s Growth Projections
The Zacks Consensus Estimate for fiscal fourth-quarter 2024 earnings per share (EPS) has moved up 3.5% in the past 90 days to 89 cents.
The Zacks Consensus Estimate for sales is pinned at $406.97 million, indicating year-over-year growth of 22.8%.
NJR’s Return on Equity
ROE indicates how efficiently a company has been utilizing the funds to generate higher returns. Currently, New Jersey Resources’ ROE is 11.06%, higher than the industry’s average of 9.29%. This indicates that the company has been utilizing the funds more constructively than its peers in the utility gas distribution industry.
NJR’s Solvency
The time-to-interest earned ratio at the end of the fiscal third quarter was 3.3. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.
NJR’s Dividend Growth
New Jersey Resources has been increasing shareholders' value by paying dividends. NJR has paid quarterly dividends continuously since its inception in 1952, and has raised the dividend every year for the past 29 years. In September 2024, the company’s board of directors approved a 7.1% increase in quarterly dividend rate. The new quarterly dividend is 45 cents per share, resulting in an annualized dividend of $1.80 per share compared with the previous figure of $1.68. The company’s current dividend yield is 3.79%, better than the Zacks S&P 500 composite’s 1.19%.
NJR’s Systematic Investments & Customer Growth
New Jersey Resources makes consistent investments to upgrade and maintain its existing infrastructure. The idea is to provide reliable services to its customers around the clock. The company expects capital expenditures to be in the range of $495-$675 million for fiscal 2025.
The company added 5,939 new customers during the first nine months of fiscal 2024 compared with 5,892 in the corresponding period of fiscal 2023. It expects these new customers to contribute nearly $5.1 million of incremental utility gross margin on an annualized basis.
NJR’s Price Performance
In the past month, shares of the company have risen 3.3% against the sector’s 1.1% decline.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same sector are ONE Gas, Inc. (OGS - Free Report) , Atmos Energy (ATO - 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.
OGS’ long-term earnings growth rate is 5%. The Zacks Consensus Estimate for OGS’s fourth-quarter sales indicates an increase of 8.9% from the year-ago’s registered figure.
ATO’s long-term earnings growth rate is 7%. The company delivered an average earnings surprise of 3.4% in the past four quarters.
NI’s long-term earnings growth rate is 6.95%. The Zacks Consensus Estimate for NI’s 2024 EPS indicates year-over-year growth of 8.1%.