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MDU Resources' (MDU) Investments, Solid Liquidity Augur Well
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MDU Resources Group, Inc.’s (MDU - Free Report) two-platform business model, strategic buyouts, planned investments in the electric and natural gas utility, rising backlog as well as ongoing projects are its key tailwinds. Also, the company boasts enough liquidity to meet its near-term obligations.
We recently issued an updated research report on this currently Zacks Rank #3 (Hold) company.
The company’s long-term (three to five years) earnings growth rate is pegged at 5%.
What’s Boosting the Stock?
MDU Resources’ two-platform business model, namely the regulated energy delivery platform and the construction materials and services platform include different operating segments. This strategy helps balancing out industry-related seasonality risks that adversely impact demand.
The company spent $413.8 million in the first nine months of 2020, expecting to invest $626 million in the full year. These investments will increase its reliability of services and enable it to serve the growing customer base more efficiently.
As of Sep 30, 2020, construction materials had a backlog of $571.3 million while that of the construction services business was $1.3 billion. Further, the construction material business continues to acquire operations for expanding the company’s aggregate reserves and its market coverage across the West United States.
Moreover, total liquidity of MDU Resources at the end of the first nine months was worth $718.7 million, which will be sufficient to meet its near-term debt obligation.
Woes
However, the company’s electric and natural gas transmission, and distribution businesses are governed by the federal, state and local administrative agencies. Also, changes in strict regulations or the introduction of additional rules could increase its overall expenses depending on the extent of its investments. Moreover, aging infrastructure and stiff competition remain concerns.
Price Performance
In the past six months, shares of the company have gained 11.3% against the industry's decline of 7.8%.
Stocks to Consider
A few better-ranked utilities are Otter Tail Corporation (OTTR - Free Report) , Portland General Electric Company (POR - Free Report) and Primo Water Corporation (PRMW - Free Report) . Otter Tail currently flaunts a Zacks Rank #1 (Strong Buy) while Portland General Electric Company and Primo Water are carrying a Zacks Rank#2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Otter Tail delivered an earnings surprise of 9.93%, on average, in the trailing four quarters. The Zacks Consensus Estimate for 2020 earnings has been revised 1.8% upward in the past 60 days.
Portland General Electric Company delivered an earnings surprise of 98.07%, on average, in the trailing four quarters. The company’s long-term (three to five years) earnings growth rate is pegged at 5.48%.
Primo Water delivered an earnings surprise of 65%, on average, in the trailing four quarters. The Zacks Consensus Estimate for 2020 earnings has moved 20.9% north in the past 60 days.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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MDU Resources' (MDU) Investments, Solid Liquidity Augur Well
MDU Resources Group, Inc.’s (MDU - Free Report) two-platform business model, strategic buyouts, planned investments in the electric and natural gas utility, rising backlog as well as ongoing projects are its key tailwinds. Also, the company boasts enough liquidity to meet its near-term obligations.
We recently issued an updated research report on this currently Zacks Rank #3 (Hold) company.
The company’s long-term (three to five years) earnings growth rate is pegged at 5%.
What’s Boosting the Stock?
MDU Resources’ two-platform business model, namely the regulated energy delivery platform and the construction materials and services platform include different operating segments. This strategy helps balancing out industry-related seasonality risks that adversely impact demand.
The company spent $413.8 million in the first nine months of 2020, expecting to invest $626 million in the full year. These investments will increase its reliability of services and enable it to serve the growing customer base more efficiently.
As of Sep 30, 2020, construction materials had a backlog of $571.3 million while that of the construction services business was $1.3 billion. Further, the construction material business continues to acquire operations for expanding the company’s aggregate reserves and its market coverage across the West United States.
Moreover, total liquidity of MDU Resources at the end of the first nine months was worth $718.7 million, which will be sufficient to meet its near-term debt obligation.
Woes
However, the company’s electric and natural gas transmission, and distribution businesses are governed by the federal, state and local administrative agencies. Also, changes in strict regulations or the introduction of additional rules could increase its overall expenses depending on the extent of its investments. Moreover, aging infrastructure and stiff competition remain concerns.
Price Performance
In the past six months, shares of the company have gained 11.3% against the industry's decline of 7.8%.
Stocks to Consider
A few better-ranked utilities are Otter Tail Corporation (OTTR - Free Report) , Portland General Electric Company (POR - Free Report) and Primo Water Corporation (PRMW - Free Report) . Otter Tail currently flaunts a Zacks Rank #1 (Strong Buy) while Portland General Electric Company and Primo Water are carrying a Zacks Rank#2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Otter Tail delivered an earnings surprise of 9.93%, on average, in the trailing four quarters. The Zacks Consensus Estimate for 2020 earnings has been revised 1.8% upward in the past 60 days.
Portland General Electric Company delivered an earnings surprise of 98.07%, on average, in the trailing four quarters. The company’s long-term (three to five years) earnings growth rate is pegged at 5.48%.
Primo Water delivered an earnings surprise of 65%, on average, in the trailing four quarters. The Zacks Consensus Estimate for 2020 earnings has moved 20.9% north in the past 60 days.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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