CenterPoint Energy, Inc.’s (NYSE:CNP) steady growth in customer count has primarily driven its performance in the past several quarters. Its system modernization initiatives and expansion of operation are expected to fuel growth in the future.
Let’s discuss the factors that make the stock an appropriate investment option at the moment.
Zacks Rank and VGM Score
The company currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Our proprietary VGM Score is based on research that has proven that stocks with the best value, growth and momentum characteristics outperform the market. V stands for Value, G for Growth and M for Momentum. CenterPoint Energy has a VGM Score of B.
Growth Projections
The Zacks Consensus Estimate for 2019 earnings per share is pegged at $1.66 on $12.54-billion revenues. The bottom and the top line are expected to rise 3.75% and 18.45% on a year-over-year basis, respectively.
The consensus mark for 2020 earnings is pegged at $1.80 per share on revenues of $12.92 billion. While the bottom line suggests 8.63% increase, the top line calls for a 2.99% rise on a year-over-year basis.
The company’s long-term (three to five years) earnings growth is pegged at 5.46%.
Price Movement& Dividend Yield
Shares of the company have gained on a long-term basis. In the past three years, the stock has rallied 29.3% compared with the industry’s rise of 19.7%.
Currently, the company has a dividend yield of 3.95% compared with the Zacks S&P 500 composite’s 1.97% and the industry’s 2.84%.
Investment Plans
CenterPoint Energy is investing substantially to expand its operations and cater to increasing utility demand. The company is currently focused on upgrading infrastructure and improving reliability. Notably, its capital expenditure totaled $514 million in the second quarter, up 16.6% year over year. Going ahead, the company plans to invest $12.1 billion from 2019 through 2023. These funds will be utilized primarily to maintain reliability and safety, increase resiliency as well as expand CenterPoint Energy’s systems through value-added projects.
Other Stocks to Consider
Some other top-ranked stocks in the Utility sector are Pampa Energia S.A. (NYSE:PAM) , NRG Energy, Inc (NYSE:NRG) and Avista Corporation (NYSE:AVA) . Pampa Energia and NRG Energy sport a Zacks Rank #1, while Avista carries a Zacks of 2.
Pampa Energia, NRG Energy and Avista delivered average positive earnings surprise of 143.10%, 11.64% and 0.08% in the last four quarters, respectively.
The long-term earnings growth rate for Pampa Energia, NRG Energy and Avista is pegged at 20.59%, 36.26% and 3.32%, respectively.
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CenterPoint Energy, Inc. (CNP): Free Stock Analysis Report
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Zacks Investment Research