Back to top

Image: Bigstock

Evergy to Benefit From Investments & Renewable Expansion

Read MoreHide Full Article

Evergy, Inc.’s (EVRG - Free Report) planned investments and strategic acquisitions should further help expand its operations in the transmission market. The company intends to add more renewable assets to boost its overall performance.

However, this Zacks Rank #3 (Hold) company faces risks related to delays in completing ongoing capital projects and weather fluctuations.

Tailwinds Favoring EVRG

Evergy’s long-term investment plans are focused on transmission, distribution infrastructure upgrades and customer-facing platforms to improve reliability. The company targets nearly $16.2 billion of capital investments for 2025-2029. Evergy's planned capital expenditures are in sync with its new Integrated Resource Plan. The company intends to achieve net-zero emissions by 2045, with an interim goal of reducing carbon dioxide emissions by 70% within 2030.

EVRG aims to lower emissions by shutting down fossil-fuel-based plants and adding new efficient units of clean power generation. The use of more advanced technology to produce electricity from efficient renewable units is also reducing operating costs and boosting margins.

In October 2024, Evergy announced its plan to construct two combined-cycle natural gas plants in Kansas. Evergy Kansas Central and Evergy Missouri West will jointly own the first site, which is expected to have an initial generating capacity of nearly 705 megawatts (MW). The plant is anticipated to begin operations by the summer of 2029. The second site, which is expected to begin operations by the summer of 2030, also has a capacity of almost 705 MW.

Headwinds for EVRG

The company’s capital projects could get delayed due to permit delays, inadequate availability or increased cost of equipment and materials, which are beyond its control. This could increase the cost of the projects, thereby adversely impacting EVRG’s profitability.

Electricity sales are seasonal and changing weather conditions play a pivotal role in the company’s overall performance. Mild winter and summer season can reduce demand for electricity, affecting the company’s performance.

EVRG’s Price Performance

In the past six months, shares of the company have risen 15.8% compared with the industry’s 6.8% growth.

 

Zacks Investment Research
Image Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks from the same industry are Vistra (VST - Free Report) , sporting a Zacks Rank #1 (Strong Buy) at present, and IDACORP (IDA - Free Report) and DTE Energy (DTE - Free Report) , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

VST’s long-term (three to five years) earnings growth rate is 17.4%. The Zacks Consensus Estimate for 2024 earnings per share (EPS) indicates a year-over-year increase of 24.8%.

IDA’s long-term earnings growth rate is 8.31%. The Zacks Consensus Estimate for 2024 EPS indicates year-over-year growth of 5.5%.

DTE’s long-term earnings growth rate is 8.04%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year improvement of 18%.

 


Zacks' 7 Best Strong Buy Stocks (New Research Report)


Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.


Click Here, It's Really Free

Published in