On Apr 12, 2013, the shares of
) climbed to its 52-week high of $44.74 driven by its strong
projects pipeline and diversified asset base. We expect the
company's long-term earnings growth to be 7.55%.
As announced in Feb 2013, Northeast Utilities intends to invest
around $1.6 billion in 2013 to upgrade the electricity and
natural gas infrastructure. Currently, the company is in the
middle of several major projects including Greater Springfield
Reliability Project, Interstate Reliability Project and Northern
Pass Project. These initiatives will enable the company to
increase the transmission capacity, which will subsequently help
to meet the rise in customers' demand.
In Apr 2012, Northeast Utilities completed its merger with NSTAR
and enjoyed related benefits in fourth quarter 2012. Quarterly
revenues surpassed the prior-year results due to strong
performance by the transmission segment primarily backed by this
merger. We believe this merger will aid the company to increase
its scale of operations and serve a wider customer base in the
As of Dec 31, 2012, Northeast Utilities had $45.7 million in cash
and $1.45 billion available under its revolving credit
facilities. This financial position enables the company to pursue
steady inorganic as well as organic growth strategies.
Northeast Utilities expects a steady performance in 2013. The
company's earnings guidance for full year 2013 is $2.40 to $2.60
per share. The Zacks Consensus Estimates for full year 2013 and
2014 is $2.55 and 2.71 per share, up 12.06% and 6.18% year over
In Feb 2013, the board of directors of Northeast Utilities
increased its quarterly dividend by 7.1% to 36.75 cents per
share. The company has been boosting its investors' income by
hiking the dividend payment consistently since 1966. The
company's practice of raising dividends from time to time will
benefit the stock as it attracts investor attention.
Northeast Utilities currently has a Zacks Rank #2 (Buy). Besides
Northeast Utilities, other stocks from the industry that are
performing well include
Brookfield Infrastructure Partners L.P.
Empresa Nacional de Electricidad S.A.
Pike Electric Corporation
). All the three stocks carry a Zacks Rank #1 (Strong Buy).
BROOKFIELD INFR (BIP): Free Stock Analysis
ENDESA-CHILE (EOC): Free Stock Analysis
NORTHEAST UTIL (NU): Free Stock Analysis
PIKE ELECTRIC (PIKE): Free Stock Analysis
To read this article on Zacks.com click here.