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Can Grid Modernization Support Eversource's Long-Term Growth?
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Key Takeaways
Eversource plans to invest $26.5B through 2030 in transmission, distribution and grid modernization.
Eversource sees transmission spending as a growth driver as New England electricity demand increases.
Grid investments are expected to support 5-7% long-term EPS growth, moving toward the upper half by 2028.
Eversource Energy (ES - Free Report) is strengthening its electric grid through modernization and advanced metering initiatives to enhance operational efficiency. These investments can also improve service quality and support growing customer demand.
Eversource operates an extensive electric network comprising nearly 59,900 distribution miles and 4,500 transmission miles, which allows the company to efficiently meet demand and provide high-quality services to its customers.
The company plans to invest nearly $26.5 billion through 2030, which includes $7.14 billion for transmission and $11.42 billion for the electric distribution network. ES also sees $1.7 billion of potential incremental investments, including $1 billion for Connecticut advanced metering infrastructure and $700 million related to the longer-term transmission planning process.
Transmission spending could become an important growth driver as electricity demand rises across New England. ISO-New England has preliminarily selected Eversource and Avangrid’s $2.2 billion transmission proposal, with ES’ share expected to be about $700 million. The project is intended to increase transmission capacity and reduce congestion costs, although final approval remains pending.
The investment program provides a strong opportunity to expand Eversource’s regulated rate base and generate earnings growth. The company is targeting 5-7% long-term earnings per share growth, with growth expected to move toward the upper half of this range by 2028.
Overall, rising power demand, transmission opportunities and sustained grid spending are expected to strengthen ES’ regulated rate base and support long-term earnings (EPS) growth. These investments also position the company to capitalize on increasing electricity needs.
Strategic Expenditures Drive Grid Modernization
A strategic capital program enhances the grid through targeted investments in transmission, distribution and modernization initiatives. The investments improve grid reliability, replace aging assets, increase system capacity, accommodate growing power demand, expand the regulated rate base and support long-term earnings growth.
FirstEnergy Corp. (FE - Free Report) is advancing grid modernization through its multi-year Energize365 program, aimed at strengthening infrastructure, enhancing customer service and supporting affordability. The company plans to invest $36 billion from 2026 to 2030.
PPL Corporation (PPL - Free Report) aims to invest $23 billion through 2029, which includes grid hardening, smart-grid technology, automation and transmission expansion, supporting reliability and approximately 10.3% annual rate-base growth.
The Zacks Rundown on ES
ES’ Earnings Estimates
The Zacks Consensus Estimate for 2026 EPS indicates a year-over-year decrease of 2.52%, while the estimate for 2027 EPS suggests a 6.45% increase.
Image Source: Zacks Investment Research
ES’ Stock Trading at a Discount
ES is trading at a discount to the industry, with a forward 12-month price-to-earnings ratio of 14.82X versus the industry average of 15.42X.
Image Source: Zacks Investment Research
ES’ Stock Price Performance
In the past three months, the company’s shares have risen 4.8% compared with the industry’s 5.3% growth.
View the Zacks #1 Rank List
Image: Bigstock
Can Grid Modernization Support Eversource's Long-Term Growth?
Key Takeaways
Eversource Energy (ES - Free Report) is strengthening its electric grid through modernization and advanced metering initiatives to enhance operational efficiency. These investments can also improve service quality and support growing customer demand.
Eversource operates an extensive electric network comprising nearly 59,900 distribution miles and 4,500 transmission miles, which allows the company to efficiently meet demand and provide high-quality services to its customers.
The company plans to invest nearly $26.5 billion through 2030, which includes $7.14 billion for transmission and $11.42 billion for the electric distribution network. ES also sees $1.7 billion of potential incremental investments, including $1 billion for Connecticut advanced metering infrastructure and $700 million related to the longer-term transmission planning process.
Transmission spending could become an important growth driver as electricity demand rises across New England. ISO-New England has preliminarily selected Eversource and Avangrid’s $2.2 billion transmission proposal, with ES’ share expected to be about $700 million. The project is intended to increase transmission capacity and reduce congestion costs, although final approval remains pending.
The investment program provides a strong opportunity to expand Eversource’s regulated rate base and generate earnings growth. The company is targeting 5-7% long-term earnings per share growth, with growth expected to move toward the upper half of this range by 2028.
Overall, rising power demand, transmission opportunities and sustained grid spending are expected to strengthen ES’ regulated rate base and support long-term earnings (EPS) growth. These investments also position the company to capitalize on increasing electricity needs.
Strategic Expenditures Drive Grid Modernization
A strategic capital program enhances the grid through targeted investments in transmission, distribution and modernization initiatives. The investments improve grid reliability, replace aging assets, increase system capacity, accommodate growing power demand, expand the regulated rate base and support long-term earnings growth.
FirstEnergy Corp. (FE - Free Report) is advancing grid modernization through its multi-year Energize365 program, aimed at strengthening infrastructure, enhancing customer service and supporting affordability. The company plans to invest $36 billion from 2026 to 2030.
PPL Corporation (PPL - Free Report) aims to invest $23 billion through 2029, which includes grid hardening, smart-grid technology, automation and transmission expansion, supporting reliability and approximately 10.3% annual rate-base growth.
The Zacks Rundown on ES
ES’ Earnings Estimates
The Zacks Consensus Estimate for 2026 EPS indicates a year-over-year decrease of 2.52%, while the estimate for 2027 EPS suggests a 6.45% increase.
Image Source: Zacks Investment Research
ES’ Stock Trading at a Discount
ES is trading at a discount to the industry, with a forward 12-month price-to-earnings ratio of 14.82X versus the industry average of 15.42X.
Image Source: Zacks Investment Research
ES’ Stock Price Performance
In the past three months, the company’s shares have risen 4.8% compared with the industry’s 5.3% growth.
Image Source: Zacks Investment Research
ES’ Zacks Rank
ES currently has a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.