Westar Energy, Inc.
) has announced its plan to issue 8 million shares of its common
stock and utilize the net proceeds to repay short-term debt
obligations under its commercial paper program, finance current
projects and fund for general corporate purposes. The issuance of
common stock is subject to market conditions.
Per the conditions of the issuance, the underwriters can purchase
up to an additional 1.2 million shares of common stock within a
period of one month to cover over allotments, if any.
As of Jun 30, 2013, Westar Energy had approximately 127.9 million
shares of diluted common stock outstanding. With the current
offering, the company's number of shares will increase to roughly
It is evident from Westar Energy's capital spending program that
the company currently intends to upgrade its utility assets and
add new ones. In Aug 2013, the company received a route approval
from the Kansas Corporation Commission to execute a transmission
project. Westar Energy will invest $66 million in this venture.
Westar Energy follows the practice of issuing new shares and uses
the net proceeds to repay its outstanding short-term debts while
the remaining is utilized for general corporate purposes. In Nov
2010, the company issued 7 million shares of its common stock.
During the six months ended Jun 30, 2013, Westar Energy paid a
cash dividend of $80.9 million to its shareholders. As of Sep 23,
2013, the company reported annual dividend yield of 4.4%, higher
than the industry average of 2%. This will make the company
attractive to the investors.
Westar Energy currently has a Zacks Rank #3 (Hold). However,
other stocks in the industry that are worth considering include
Brookfield Infrastructure Partners L.P.
Huaneng Power International, Inc.
), each with a Zacks Rank #2 (Buy).
BROOKFIELD INFR (BIP): Free Stock Analysis
HUANENG POWER (HNP): Free Stock Analysis
IDACORP INC (IDA): Free Stock Analysis Report
WESTAR ENERGY (WR): Free Stock Analysis
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