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Dynegy (DYN) Scales a 52-Week High on Asset Divestitures

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Dynegy Inc. hit a new 52-week high of $13.58 before closing the session a bit lower at $13.38 on Mar 9. Year to date, the stock has delivered an impressive return of about 79.4% compared with the S&P 500 index’s rally of 17.8%.

Over the past 52 weeks, Dynegy’s shares have ranged from a low of $5.84 to a high of $13.58. Average volume of shares traded over the last three months is approximately 3.38 million.

What's Driving Dynegy Higher?

Dynegy delivered a positive earnings surprise of 103.03% in the fourth quarter. In 2017, Dynegy divested five power generation facilities for $773 million cash. The company used the proceeds and cash in hand to clear outstanding debts of $900 million. Through repayments and refinancing, Dynegy reduced the debt maturity for 2019 to $850 million from $2.1 billion.

On Feb 7, 2017, the company completed the acquisition of ENGIE's U.S. portfolio with 9,017 megawatts of predominately gas-fueled generating capacity in the ERCOT, ISO-NE, and PJM markets. This buyout, along with the others since 2013, helped the company convert its generation portfolio to a predominately gas-based one from coal-based.

Owing to these positive initiatives, the Zacks Consensus Estimate for 2018 moved up 244.8% in the last 60 days.

Dynegy’s integration with Vistra Energy (VST - Free Report) will result in multiple capital allocation and growth opportunities, which will boost shareholder’s value

Zacks Rank & Other Stocks to Consider

Dynegy carries a Zacks Rank #2 (Buy).

A few other top-ranked stocks in the same industry are CenterPoint Energy, Inc. (CNP - Free Report) and NextEra Energy, Inc. (NEE - Free Report) . The stocks carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CenterPoint Energy (CNP - Free Report) posted an average positive earnings surprise of 11.5% in the past four quarters. The Zacks Consensus Estimate moved up 5.4% in the last 30 days.

NextEra Energy (NEE - Free Report) posted an average positive earnings surprise of 4.75% in the past four quarters. The Zacks Consensus Estimate moved up 5% in the last 30 days.

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