In a report released yesterday, Neil Kalton from Wells Fargo maintained a Buy rating on Xcel Energy (XEL – Research Report), with a price target of $75.00.
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Neil Kalton has given his Buy rating due to a combination of factors that highlight Xcel Energy’s potential for growth and value. Firstly, despite a slight underperformance in 2024, the company’s management has reiterated confidence in achieving the midpoint of their 2025 earnings guidance, suggesting a strong future earnings trajectory. Additionally, Xcel Energy has identified significant capital expenditure opportunities, including over $10 billion in potential investments beyond their base plan, which could enhance their generation resources and contribute to long-term growth.
Moreover, the company stands to benefit from substantial transmission project awards, representing a $3-4 billion investment opportunity, which could provide additional upside to their capital expenditure plans. The valuation of Xcel Energy’s shares is also attractive, as they trade at a slight discount compared to peers, with potential for premium valuation if they achieve higher-than-expected earnings growth. Lastly, manageable liabilities from prior wildfire incidents and mitigation efforts to reduce future wildfire risks further support the positive outlook, making Xcel Energy an appealing investment choice.
According to TipRanks, Kalton is a 5-star analyst with an average return of 8.9% and a 63.66% success rate. Kalton covers the Utilities sector, focusing on stocks such as Xcel Energy, PG&E, and WEC Energy Group.
In another report released on January 22, Barclays also maintained a Buy rating on the stock with a $69.00 price target.