Analyst Paul Zimbardo CFA of Jefferies reiterated a Sell rating on Eversource Energy (ES – Research Report), retaining the price target of $47.00.
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Paul Zimbardo CFA has given his Sell rating due to a combination of factors affecting Eversource Energy. Key concerns include the potential for increased costs related to the Revolution Wind project, as indicated by new cautionary language in the company’s 10K filing. These potential cost overruns could lead to material financial losses beyond the $365 million already recorded. Moreover, there are notable challenges concerning the tax deductibility of investment tax credits for the South Fork Wind project, which could impact the company’s financial position adversely.
Another significant factor influencing the Sell rating is Eversource Energy’s ongoing need to repair its balance sheet, which remains under pressure. The company has underperformed relative to expectations for cash flows and credit metrics for 2024 and 2025, with figures not aligning with management’s assurances of staying above the Moody’s downgrade threshold. Additionally, recent stock performance appears inconsistent with these deteriorating fundamentals, suggesting a cautious outlook for investors.
In another report released on February 13, Scotiabank also maintained a Sell rating on the stock with a $55.00 price target.