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AVANGRID (AGR) Benefits From Investment & Debt Management
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AVANGRID Inc. (AGR - Free Report) has been gaining from consistent investments to strengthen infrastructure. An expanding wind and solar generation portfolio is likely to drive its performance over the long run.
AVANGRID currently carries a Zacks Rank #3 (Hold) and has delivered an average earnings surprise of 13% in the last four quarters. AGR’s long-term (three to five years) earnings growth is currently pegged at 6.2%. Moreover, AVANGRID’s current dividend yield of 3.9% is better than the industry average of 3.1%. You can see the complete list of today’s Zacks #1Rank (Strong Buy) stocks here.
Tailwinds
AVANGRID has operations in 24 states. In 2021, the company operated 8.8 gigawatts of wind, solar and thermal installed electricity capacity. AGR plans to create a clean generation portfolio with 90% renewables and Scope 1 carbon neutrality goal by 2035. AVANGRID Renewables also started the onshore construction of the Vineyard Wind I project, an 800 megawatts utility-scale offshore wind project, which is expected to reduce carbon emissions by more than 1.6 million tons per year.
To maintain and upgrade infrastructure and facilities, AVANGRID plans to invest $1.9 billion in 2022 to provide customers with a safe and reliable infrastructure and support the clean energy transition. AGR aims to invest $20 billion through 2025. AVANGRID makes regulated and contracted investments, which guarantee earnings and cash flows.
AVANGRID’s long-term debt to capital declined from 40.5% at the end of 2020 to 29.4% at the end of the fourth quarter of 2021. The times interest earned (TIE) ratio of the company at the end of the fourth quarter of 2021 was 3.2, up from 2.8 at the end of the fourth quarter of 2020. AGR’s strong TIE indicates that the company will be able to meet near-term debt obligations without any difficulty.
Headwinds
Although AVANGRID keeps investing in development opportunities, timely completion of the projects within budget might not be possible. Denial of necessary regulatory approvals for the PNM Resources merger has affected AVANGRID’s business and future growth plans. To meet the stringent rules and regulations and maintain cyber security, AGR needs to bear additional costs.
Price Performance
In the past month, shares of AVANGRID have rallied 0.1% compared with the industry’s 4.1% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the same industry are Xcel Energy (XEL - Free Report) , PNM Resources (PNM - Free Report) and WEC Energy (WEC - Free Report) , each currently carrying a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for 2022 earnings per share of Xcel Energy, PNM Resources and WEC Energy has moved up 7.43%, 4.08% and 4.62%, respectively, year over year.
The long-term earnings growth of Xcel Energy, PNM Resources and WEC Energy is projected at 6.4%, 5% and 6%, respectively.
XEL, PNM and WEC delivered an average earnings surprise of 2.1%, 40% and 9.1%, respectively, in the last four quarters.
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AVANGRID (AGR) Benefits From Investment & Debt Management
AVANGRID Inc. (AGR - Free Report) has been gaining from consistent investments to strengthen infrastructure. An expanding wind and solar generation portfolio is likely to drive its performance over the long run.
AVANGRID currently carries a Zacks Rank #3 (Hold) and has delivered an average earnings surprise of 13% in the last four quarters. AGR’s long-term (three to five years) earnings growth is currently pegged at 6.2%. Moreover, AVANGRID’s current dividend yield of 3.9% is better than the industry average of 3.1%. You can see the complete list of today’s Zacks #1Rank (Strong Buy) stocks here.
Tailwinds
AVANGRID has operations in 24 states. In 2021, the company operated 8.8 gigawatts of wind, solar and thermal installed electricity capacity. AGR plans to create a clean generation portfolio with 90% renewables and Scope 1 carbon neutrality goal by 2035. AVANGRID Renewables also started the onshore construction of the Vineyard Wind I project, an 800 megawatts utility-scale offshore wind project, which is expected to reduce carbon emissions by more than 1.6 million tons per year.
To maintain and upgrade infrastructure and facilities, AVANGRID plans to invest $1.9 billion in 2022 to provide customers with a safe and reliable infrastructure and support the clean energy transition. AGR aims to invest $20 billion through 2025. AVANGRID makes regulated and contracted investments, which guarantee earnings and cash flows.
AVANGRID’s long-term debt to capital declined from 40.5% at the end of 2020 to 29.4% at the end of the fourth quarter of 2021. The times interest earned (TIE) ratio of the company at the end of the fourth quarter of 2021 was 3.2, up from 2.8 at the end of the fourth quarter of 2020. AGR’s strong TIE indicates that the company will be able to meet near-term debt obligations without any difficulty.
Headwinds
Although AVANGRID keeps investing in development opportunities, timely completion of the projects within budget might not be possible. Denial of necessary regulatory approvals for the PNM Resources merger has affected AVANGRID’s business and future growth plans. To meet the stringent rules and regulations and maintain cyber security, AGR needs to bear additional costs.
Price Performance
In the past month, shares of AVANGRID have rallied 0.1% compared with the industry’s 4.1% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the same industry are Xcel Energy (XEL - Free Report) , PNM Resources (PNM - Free Report) and WEC Energy (WEC - Free Report) , each currently carrying a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for 2022 earnings per share of Xcel Energy, PNM Resources and WEC Energy has moved up 7.43%, 4.08% and 4.62%, respectively, year over year.
The long-term earnings growth of Xcel Energy, PNM Resources and WEC Energy is projected at 6.4%, 5% and 6%, respectively.
XEL, PNM and WEC delivered an average earnings surprise of 2.1%, 40% and 9.1%, respectively, in the last four quarters.