On Friday, Southwest Gas Holdings Inc (NYSE:SWX) maintained its Neutral rating and a price target of $76.00, as confirmed by a leading financial institution. The firm's outlook for the company has grown more positive due to several key factors expected to influence its performance in the second half of 2024.
The anticipated recovery in utility capital expenditures (capex) in the latter half of the year is projected to benefit the results of Centuri Group, Inc., a subsidiary of Southwest Gas. This recovery is seen as a crucial element that could drive the company's financial performance forward.
Additionally, the conclusion of the Centuri CEO search process, expected by the second half of 2024, is likely to enhance Southwest Gas's ability to divest its stake in Centuri at a more favorable exchange ratio. The appointment of a new CEO is anticipated to bring a strategic advantage to the company.
Furthermore, a workshop scheduled for October 3 at the Arizona Corporation Commission (ACC) is set to showcase the commission's support for advancing the state towards adopting a forward test year or a formula rate. This development is significant as it could lead to a more stable and predictable regulatory environment for Southwest Gas in Arizona, potentially impacting the company's regulatory framework and future earnings.
The financial institution's stance reflects these upcoming developments, which could influence Southwest Gas's strategic decisions and financial results in the near future. The company's stock performance and investor expectations may be shaped by these events as they unfold in the second half of 2024.
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