Xcel Energy (XEL – Research Report), the Utilities sector company, was revisited by a Wall Street analyst today. Analyst Julien Dumoulin Smith from Jefferies reiterated a Buy rating on the stock and has a $81.00 price target.
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Julien Dumoulin Smith has given his Buy rating due to a combination of factors that highlight Xcel Energy’s promising growth trajectory and financial stability. The company has incorporated an additional $8.5 billion in capital expenditures into its outlook, which is expected to drive an 8.5% compound annual growth rate (CAGR) in earnings per share over the next five years. This growth is underpinned by a projected increase in electric load growth, which is anticipated to accelerate from 3% in 2025 to 5% by 2029.
Furthermore, Xcel Energy is expected to benefit from improvements in its rate of return on equity (ROE) and a robust pipeline of customer demand, particularly from data centers and organic growth within its service territory. The company’s strong balance sheet and strategic investments, including the NSPM IRP settlement and the Southwest Power Pool project, add to its potential for growth. Despite ongoing litigation risks, the company’s defensive nature and strategic investments position it well for future success, leading to an increased price target of $81.
In another report released on March 28, Barclays also maintained a Buy rating on the stock with a $72.00 price target.