Middlesex Water Company: Buy Rating Amidst Attractive Valuation and Promising Regulatory Developments

Janney Montgomery analyst Michael Gaugler upgraded the rating on Middlesex Water Company (MSEX – Research Report) to a Buy today, setting a price target of $66.00.

Michael Gaugler has given his Buy rating due to a combination of factors including the current valuation of Middlesex Water Company. The recent decline in share price presents an opportunity for investors, as there is more than a 10% potential upside to the fair value estimate of $66. This suggests that now is a favorable time to either start or increase investment positions in the company.
Additionally, the company’s future outlook is promising, with significant developments in regulatory proceedings such as the Delaware rate case nearing completion and a New Jersey rate case anticipated in 2025. The capital expenditure plans are expected to drive substantial growth in both the rate base and earnings per share. The fair value estimate is based on a price-to-earnings ratio of 25 times the projected 2026 earnings per share, which is deemed appropriate given the company’s strong regulatory relationships in its operational areas.