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Here's Why You Should Add PPL to Your Portfolio Right Now
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PPL Corporation’s (PPL - Free Report) strategic investment plans should strengthen its infrastructure. The company’s focus on clean generation and growth in domestic operations boost its earnings performance. Given its growth opportunities, PPL makes for a solid investment option in the utility sector.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.
Growth Projections
The Zacks Consensus Estimate for PPL’s 2024 earnings per share (EPS) has increased 0.6% to $1.71 in the past 30 days.
The Zacks Consensus Estimate for 2025 EPS has increased 0.5% to $1.84 in the past 30 days.
PPL’s long-term (three to five years) earnings growth rate is 6.82%.
Debt Position
Currently, PPL’s total debt to capital is 53.3%, much better than the industry’s average of 59.58%.
The time-to-interest earned ratio at the end of first-quarter 2024 was 2.4, which, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.
Liquidity
PPL’s current ratio is 1.28, better than the industry’s average of 0.88. A current ratio greater than one indicates that the company has enough short-term assets to liquidate to cover all short-term liabilities, if necessary.
Dividend History
PPL has a long history of dividend payments and plans to increase its dividend by 6-8%, subject to the approval of its board of directors. Currently, its quarterly dividend is 25.75 cents per share, resulting in an annualized dividend of $1.03 per share. It expects the dividend payout ratio to be between 60% and 65%. The company’s current dividend yield is 3.59% compared with the Zacks S&P 500 composite's average of 1.27%.
Systematic Investments
PPL’s capital investment plan primarily focuses on infrastructure construction projects for generation, transmission and distribution. Customers have been experiencing fewer outages, courtesy of the ongoing investments in infrastructure strengthening. PPL expects a regulated capital investment plan of $14.3 billion during 2024-2027. The capital investment for 2024 is expected to be $3.1 billion.
Price Performance
In the past three months, PPL’s shares have rallied 8.5% against the industry’s average decline of 0.9%.
The Zacks Consensus Estimate for POR’s 2024 EPS implies a year-over-year improvement of 29.4%. The Zacks Consensus Estimate for sales indicates year-over-year growth of 10.3%.
DTE’s long-term earnings growth rate is 8.2%. The Zacks Consensus Estimate for DTE Energy’s 2024 EPS implies a year-over-year increase of 16.9%.
PNW’s long-term earnings growth rate is 8.22%. It delivered an average earnings surprise of 233.5% in the last four quarters.
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Here's Why You Should Add PPL to Your Portfolio Right Now
PPL Corporation’s (PPL - Free Report) strategic investment plans should strengthen its infrastructure. The company’s focus on clean generation and growth in domestic operations boost its earnings performance. Given its growth opportunities, PPL makes for a solid investment option in the utility sector.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.
Growth Projections
The Zacks Consensus Estimate for PPL’s 2024 earnings per share (EPS) has increased 0.6% to $1.71 in the past 30 days.
The Zacks Consensus Estimate for 2025 EPS has increased 0.5% to $1.84 in the past 30 days.
PPL’s long-term (three to five years) earnings growth rate is 6.82%.
Debt Position
Currently, PPL’s total debt to capital is 53.3%, much better than the industry’s average of 59.58%.
The time-to-interest earned ratio at the end of first-quarter 2024 was 2.4, which, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.
Liquidity
PPL’s current ratio is 1.28, better than the industry’s average of 0.88. A current ratio greater than one indicates that the company has enough short-term assets to liquidate to cover all short-term liabilities, if necessary.
Dividend History
PPL has a long history of dividend payments and plans to increase its dividend by 6-8%, subject to the approval of its board of directors. Currently, its quarterly dividend is 25.75 cents per share, resulting in an annualized dividend of $1.03 per share. It expects the dividend payout ratio to be between 60% and 65%. The company’s current dividend yield is 3.59% compared with the Zacks S&P 500 composite's average of 1.27%.
Systematic Investments
PPL’s capital investment plan primarily focuses on infrastructure construction projects for generation, transmission and distribution. Customers have been experiencing fewer outages, courtesy of the ongoing investments in infrastructure strengthening. PPL expects a regulated capital investment plan of $14.3 billion during 2024-2027. The capital investment for 2024 is expected to be $3.1 billion.
Price Performance
In the past three months, PPL’s shares have rallied 8.5% against the industry’s average decline of 0.9%.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same industry are Portland General Electric (POR - Free Report) , DTE Energy (DTE - Free Report) and Pinnacle West Capital Corporation (PNW - Free Report) , each holding a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for POR’s 2024 EPS implies a year-over-year improvement of 29.4%. The Zacks Consensus Estimate for sales indicates year-over-year growth of 10.3%.
DTE’s long-term earnings growth rate is 8.2%. The Zacks Consensus Estimate for DTE Energy’s 2024 EPS implies a year-over-year increase of 16.9%.
PNW’s long-term earnings growth rate is 8.22%. It delivered an average earnings surprise of 233.5% in the last four quarters.