On Oct 10, 2013, we have reiterated our Neutral recommendation
). The company currently has a Zacks Rank #3 (Hold).
BROOKFIELD INFR (BIP): Free Stock Analysis
EXELON CORP (EXC): Free Stock Analysis Report
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ALLIANT ENGY CP (LNT): Free Stock Analysis
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Why the Reiteration?
Exelon's earnings per share in the previous quarter were 53
cents, missing the Zacks Consensus Estimate by a penny and the
year-ago figure by 8 cents primarily due to lower energy margins
at Generation segment, higher operating and maintenance costs,
and an increase in depreciation expenses.
Exelon continues to maintain a strong financial position along
with stable cash generation capacity. The company's cash balance
improved to $0.96 billion as of Jun 30, 2013 from $0.7 billion as
of Mar 31, 2013. During the first six months of 2013, the
company's cash generated from operating activities was $1.2
billion. A stable financial position enables Exelon to follow a
steady organic and inorganic growth strategy.
The company is currently focusing on installing smart meters and
smart grids at the utilities operations, and intends to invest
approximately $2.5 billion for this purpose. Successful
completion of these projects will help Exelon to provide
uninterrupted services to its customers at lower electricity
rates, while reducing breakdowns and operating costs.
Exelon is also expanding its renewable portfolio and plans to
spend $0.8 billion between 2013 and 2014. The company has already
acquired a 230-megawatt solar photovoltaic project, Antelope
First Solar, Inc.
). These initiatives will enable the company to produce
additional carbon-free power in the coming years. The additional
output will help the company to fulfill the Environmental
Protection Agency's regulations coming into effect in late 2014.
On the flip side, Exelon's generation and energy delivery
businesses are highly regulated. We note that changes in
regulations could interrupt the company's business plans, which
in turn, may impact its performance going forward.
Exelon's performance depends on price fluctuations in the
wholesale power markets. Wholesale power prices are dependent on
supply and demand, which in turn, are determined by several
factors like fuel prices. In addition, an impact of economic
condition, and implementation of energy efficiency and energy
demand response programs could influence Exelon's future results.
Other Stocks to Consider
Other stocks from the industry that are presently performing well
Brookfield Infrastructure Partners L.P.
Alliant Energy Corporation
), each with a Zacks Rank #2 (Buy).