XEL - Xcel Energy: Requests For Higher ROE Beneficial Guidance And Undervalued

2024-02-04 00:23:56 ET

Summary

• Xcel Energy expects double-digit ROE and beneficial outcomes in Wisconsin or Minnesota, making it a must-follow stock.
• The company is focused on reducing the use of coal and investing in clean energy, with plans to invest $4.8 billion in generation resources.
• I believe that Xcel Energy could be worth close to $75-$76 or more.

Xcel Energy Inc. ( XEL ) recently delivered beneficial expectations with regard to 2024 EPS and relevant requests in Wisconsin or Minnesota to obtain double digit ROE. If we also take into account expectations with regard to lower use of coal, approximately $4.8 billion in generation resources, to promote clean investments, in my view, Xcel looks like a must-follow stock. There are some risks because the business model is highly regulated. In addition, interest rate increases, lower electricity prices, or lower incentives for clean energy could lower net income growth. With that, I believe that XEL does trade undervalued.

Xcel Energy

Based in Minneapolis, Minnesota, Xcel Energy is an electricity and energy company in the United States that currently operates in eight states, offering services and products related to the production and management of electricity....

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