We have maintained our Neutral recommendation on
). The company currently has a Zacks Rank #3 (Hold).
Why the Reiteration?
In fourth-quarter and full-year 2012, PPL Corp.'s earnings and
revenues surpassed the Zacks Consensus Estimates primarily on
strong performances by its Kentucky and UK Regulated segments. On
a year-over-year basis, the results were hurt by lower realized
and unrealized wholesale energy marketing revenues.
We view PPL Corp. as an organization with a well diversified
asset portfolio. This diverse generation mix aids the company to
benefit from proposed Environmental Protection Agency
PPL Corp. continues to focus on maintaining a strong liquidity
position. As of Dec 31, 2012, the company had $901 million in
cash and $4.7 billion available under its domestic credit
facilities. This financial condition enables the company to
follow a steady inorganic growth strategy.
In addition, the company expects to achieve a stable, long-term
growth from its regulated electricity delivery businesses through
electric and gas base rate hikes in its Kentucky Regulated
segment, improvement in operational efficiency and a strong
However, higher operating and maintenance expenses, and stringent
regulations may challenge PPL Corp.'s future performance.
The Zacks Consensus Estimate for first-quarter 2013 earnings
currently stands at 71 cents per share, up 0.95% year over year
primarily attributable to strong performances at Kentucky,
Pennsylvania and UK regulated segments.
Other Stocks to Consider
Other stocks from the industry that are presently performing
Brookfield Infrastructure Partners L.P.
Otter Tail Corporation
). All the three stocks carry a Zacks Rank #1 (Strong Buy).
BROOKFIELD INFR (BIP): Free Stock Analysis
EDISON INTL (EIX): Free Stock Analysis Report
OTTER TAIL CORP (OTTR): Free Stock Analysis
PPL CORP (PPL): Free Stock Analysis Report
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