On Thursday, Entergy Corp (NYSE:ETR) received an increment in its price target from BMO Capital, now set at $118, up from the previous $117, while the firm maintained its Outperform rating on the stock. The adjustment follows the utility company's report of first-quarter earnings that fell short of both the firm's and consensus estimates.
Entergy disclosed earnings per share (EPS) of $1.08 for the first quarter of 2024, which did not meet BMO Capital's forecast of $1.39 or the consensus expectation of $1.43. The results showed a decline from the previous year, influenced primarily by the timing of operations and maintenance (O&M) savings. These savings resulted in a $0.21 year-over-year drag, contrasting with the anticipated $0.15 increase based on annual guidance.
Despite the lower-than-expected quarterly performance, Entergy's management reaffirmed their full-year guidance for 2024, projecting an EPS range of $7.05 to $7.35, with a midpoint of $7.20. This reaffirmation aligns closely with the consensus estimate of $7.21 and BMO Capital's projection of $7.23. The confirmation of the guidance appears to have contributed to BMO Capital's decision to raise the price target slightly.
Entergy's stock performance and future expectations are closely watched by investors, as the company provides energy to several markets. The reaffirmed guidance suggests that management is confident in the company's ability to meet its financial targets for the year, despite the initial shortfall in the first quarter.
The new price target of $118 set by BMO Capital indicates a modestly positive outlook for Entergy's stock, reflecting the firm's belief in the company's potential for growth and profitability. The Outperform rating suggests that BMO Capital expects Entergy to perform better than the overall market or its sector shortly.
InvestingPro Insights
As Entergy Corp (NYSE:ETR) navigates through its financial year, the InvestingPro platform offers valuable insights that could help investors make more informed decisions. According to recent data, Entergy has a market capitalization of $22.71 billion and is trading at a P/E ratio of 9.59, which is lower than the adjusted P/E ratio for the last twelve months as of Q4 2023, suggesting a potentially undervalued stock. The company's dividend yield stands at an attractive 4.25%, with a history of raising its dividend for 9 consecutive years, indicating a commitment to returning value to shareholders.
Two InvestingPro Tips that resonate with the context of the article include Entergy's operation with a significant debt burden, a factor that investors should monitor, and the company's trading at a low earnings multiple, which could signal a buying opportunity for value investors. These tips are part of a larger pool of insights, and interested readers can find additional tips on the InvestingPro platform. For those considering a deeper dive into Entergy's financials and forecasts, using the coupon code PRONEWS24 grants an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
With analysts having revised their earnings upwards for the upcoming period and the stock trading near its 52-week high, Entergy's financial health and stock performance are key areas to watch. Currently, there are 10 more InvestingPro Tips available that could provide further clarity on the company's outlook and investment potential.
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