Alliant Energy Corporation (LNT - Free Report) is currently focused on investing and adding more natural gas and renewable assets to its generation portfolio over the span of the next ten years. Further, the company has plans of upgrading some of its coal facilities for lowering carbon emissions. However, the cost of its current backlog of projects and future capital investments may rise due to delay, further hampering operation and increasing costs. Additionally, extensive environmental regulations at both federal and state levels remain headwinds.
Alliant Energy is currently targeting a long-term annual earnings growth of 6%. Alliant Energy is well positioned to achieve its earnings growth target, thanks to for strong economic development in its service areas and ongoing investment in its regulated natural gas and renewable energy assets.
Primarily to meet stringent emission standards utilities are focusing on alternate and renewable source and lowering dependence on coal-fired production. Utilities like PNM Resources (PNM - Free Report) and Duke Energy Corporation (DUK - Free Report) have invested heavily and increased their dependency on green energy generation portfolio.
Alliant Energy is no stranger to this strategy and has been consistently investing in renewable as well as natural gas based electricity generation, while gradually lowering coal-based generation assets. The contribution from coal-based generation units in its production mix is expected to drop from 44% in 2005 to 22% in 2024. However, Alliant Energy is subject to extensive environmental regulations both at federal and state levels. The Federal interest rates have been on the rise for quite some time now, as witnessed in December 2016, March 2017, June 2017 and December 2017. Moreover, inconsistent weather conditions in its service territories adversely impacted year-to-date earnings Risks relating to delay in the completion of
Alliant Energy returned 16.6% in the last 12 months, outperforming the 11% rally of the industry it belongs to.
Alliant Energy carries a Zacks Rank #3 (Hold). A better-ranked stock from the same space is IDACORP, Inc. (IDA - Free Report) , which carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
IDACORP delivered an average surprise of 6.97% in the trailing four quarters. Its 2017 estimates have risen to $4.08 per share to $4.00 per share in the last 60 days.
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