Earnings estimates for Edison International (NYSE:EIX) have been revised upward in the past 60 days, which reflects analysts’ optimism on the stock. The Zacks Consensus Estimate for 2019 and 2020 earnings has moved up 8.2% and 0.6% to $4.72 and $4.74 per share, respectively.
Let’s focus on the factors that make the stockan appropriate pick at the moment.
Capital Investment
The company is focused on transmission and distribution of infrastructural development programs along with grid modernization and expansion of operations. Notably, Edison International is the parent holding company of Southern (NYSE:SO) California Edison (“SCE”). Currently, SCE intends to invest $8.90-$9.10 billion between 2019 and 2020.
Price Performance
Shares of the company have gained on a long-term basis. In the past five years, the stock has rallied 21.1% compared with the industry’s rise of 14.8%.
Dividend Yield
A stable financial position enables Edison International to boost shareholders’ value through payment of regular dividends. During the first quarter of 2019, the company paid dividends worth $200 million to shareholders compared with $197 million in the year-ago quarter. The management plans to raise dividend above industry average growth rate. It intends to achieve target payout ratio of 45-55% of SCE earnings over time.
Currently, the company has a dividend yield of 3.62% compared with the Zacks S&P 500 composite’s 1.88% and the industry’s 2.88%.
Zacks Rank &Long-Term Growth
The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company’s long-term (3 to 5 years) earnings growth is pegged at 5.50%.
Other Key Picks
Some other top-ranked stocks from the same industry are Xcel Energy Inc (NASDAQ:XEL) , DTE Energy Company (NYSE:DTE) and Black Hills Corporation (NYSE:BKH) , each holding a Zacks Rank of 2 (Buy).
Xcel Energy pulled off an average positive earnings surprise of 2.15% in the last four quarters. The company’s long-term earnings growth is pegged at 5.60%.
DTE Energy pulled off an average positive earnings surprise of 12.24% in the last four quarters. The company’s long-term earnings growth is pegged at 6%
Black Hills delivered an average positive earnings surprise of 5.69% in the last four quarters. The company’s long-term earnings growth is pegged at 4.80%
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