Wells Fargo has increased its price target for Xcel Energy (XEL, Financial) from $75 to $78, while maintaining an Overweight rating on the company's shares. This decision follows Xcel's management's alignment of the lower first-quarter earnings per share with anticipated figures for 2024. Despite these results, the company has reaffirmed its 2025 earnings guidance, projecting a range between $3.75 and $3.85 per share.
Xcel Energy is also making significant strides in capital expenditure opportunities related to generation, with clearer developments expected in 2025 and 2026. Furthermore, Wells Fargo identifies the Marshall Wildfire trial as a critical forthcoming event that could influence the company's trajectory.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 14 analysts, the average target price for Xcel Energy Inc (XEL, Financial) is $74.65 with a high estimate of $81.00 and a low estimate of $62.10. The average target implies an upside of 6.20% from the current price of $70.29. More detailed estimate data can be found on the Xcel Energy Inc (XEL) Forecast page.
Based on the consensus recommendation from 17 brokerage firms, Xcel Energy Inc's (XEL, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Xcel Energy Inc (XEL, Financial) in one year is $66.60, suggesting a downside of 5.25% from the current price of $70.29. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Xcel Energy Inc (XEL) Summary page.
XEL Key Business Developments
Release Date: February 06, 2025
- GAAP Earnings for 2024: $3.44 per share.
- Ongoing Earnings for 2024: $3.50 per share, excluding a non-recurring charge.
- Ongoing Earnings for 2023: $3.35 per share.
- Revenue Increase from Rate Cases and Riders: $0.87 per share.
- Higher Other Income: $0.16 per share, due to interest income and gain on debt repurchase.
- Higher Depreciation and Amortization: Decreased earnings by $0.40 per share.
- Higher Interest Charges: Decreased earnings by $0.24 per share.
- Higher O&M Expenses: Decreased earnings by $0.13 per share.
- Weather Adjusted Electric Sales Increase: 3% in Q4 and 1% for the full year.
- O&M Expenses Increase: $96 million in 2024.
- 2025 Earnings Guidance: $3.75 to $3.85 per share.
- Five-Year Base Capital Plan: $45 billion.
- Equity Issuance in 2024: Nearly $1.4 billion.
- Smokehouse Creek Wildfire Claims Settled: 113 out of 199 claims, with $73 million committed in settlements.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Xcel Energy Inc (XEL, Financial) delivered ongoing earnings of $3.50 per share for 2024, within their guidance range for the 20th consecutive year.
- The company invested over $7.5 billion in infrastructure to support energy needs, focusing on advanced technology, transmission, and carbon-free generation.
- Xcel Energy Inc (XEL) achieved a 97% availability in their wind fleet, marking their best performance in five years.
- The Sherco Solar Project's first phase began commercial operations, with future phases set to make it the largest solar facility in the upper Midwest.
- The company has maintained residential electric and natural gas bills below the national average, with historical growth rates well below inflation.
Negative Points
- Xcel Energy Inc (XEL) recorded a charge of $0.06 per share due to a disallowance of replacement power costs from a 2011 outage.
- Higher depreciation and amortization decreased earnings by $0.40 per share, reflecting capital investment programs.
- Higher interest charges, net of AFUDC debt, decreased earnings by $0.24 per share due to increased debt levels and higher interest rates.
- O&M expenses increased by $96 million in 2024, driven by investments in wildfire mitigation and increased costs from generation maintenance.
- The company faced challenges with regulatory lag, particularly in the SPS region, affecting growth despite increased customer load.
