Analyst Ross Fowler from Bank of America Securities maintained a Buy rating on H2O America and decreased the price target to $58.00 from $59.00.
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Ross Fowler has given his Buy rating due to a combination of factors that highlight H2O America’s strategic growth prospects and market positioning. The company’s pending acquisition of Quadvest in Texas is seen as a significant opportunity to enhance earnings growth and expand customer benefits. This transaction is expected to provide a long-term growth trajectory, driven by developer connections and system expansions.
Additionally, despite regulatory challenges in Connecticut, H2O America is working constructively with regulators and remains optimistic about the future proceedings. The company is also closely monitoring the Aquarion sale, although it is cautious about undertaking multiple large-scale acquisitions simultaneously. Furthermore, H2O America is perceived to be undervalued compared to its peers, with the market holding an unfounded belief about its acquisition strategy. These factors collectively support the Buy rating from Ross Fowler.