2023-06-14 14:52:54 ET
California Water Service ( NYSE: CWT ) -3.5% in Wednesday's trading as UBS downgraded the stock to Sell from Neutral with a $51 price target, cut from $59, citing continued delays in the California rate case.
UBS said its analysis applying the outcome of the last rate case to the current one leads to a 5% reduction in its EPS forecast and five-year growth rate to the water utility average 7.0% from 8.5%; its forecasts are now below consensus and below the 7.5% compound annual growth rate priced into the stock.
Additionally, a delay in a final decision in the current case exposes California Water ( CWT ) to volumetric risk because it prevents implementation of new decoupling mechanisms.
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For further details see:
California Water cut to Sell at UBS on rate case uncertainty