Itron (ITRI) Acquires Comverge To Improve Grid Solutions

Itron, Inc. (NASDAQ:ITRI) completed the acquisition of Comverge by purchasing its parent company, Peak Holding Corp., for approximately $100 million. The definitive agreement between the two was announced in early May this year.

Comverge is an industry leading provider of integrated cloud-based demand response, energy efficiency and customer engagement solutions which enable electric utilities to ensure grid reliability, lower energy costs, meet regulatory demands and enhance customer experience.

Utilities have been facing the growing need to meet energy efficiency regulations, enable customer choice in energy management and better optimize use of distributed energy resources. Thus, the combination of smart connected networks and demand side solutions is the key solution to this.

Itron, Inc. Price

Itron, Inc. Price | Itron, Inc. Quote

Notably, the combination of Comverge’s solution with Itron’s OpenWay Riva solution will enable utilities to improve its operational efficiency, distribution and energy efficiency. It will bring in new data and real-time awareness that promises to enhance consumer engagement experience.

The Comverge acquisition will enable Itron to offer a unique solution set that brings the former’s demand management solutions to the edge of the network using OpenWay Riva’s edge intelligence and processing capabilities.

Through this acquisition, Itron will help its utility customers to better facilitate grid performance and reliability, reduce peak demand, drive customer engagement and save energy. The buyout will also enhance Itron’s portfolio of grid solutions.

Excluding acquisition and integration-related costs, amortization of acquired intangible assets and purchase accounting adjustments, the company anticipates that the acquisition will be neutral to non-GAAP earnings per share in 2017 and accretive beginning in 2018.

Itron’s strategic plans include aggressively driving key operational and administrative efficiencies, implementing restructuring projects and realigning its supply chain. In addition, Itron continues to focus on expanding its portfolio of outcome-based solutions aimed at higher growth opportunities utilizing the power of OpenWay Riva platform.

Moreover, Itron has outperformed the Zacks classified Electronics Testing Equipment sub-industry over the past one year with respect to price performance. The stock rallied 54.4%, while the industry recorded growth of 48.7% over the same time frame.

Itron currently carries a Zacks Rank #3 (Hold).

Key Picks

Better-ranked stocks in the same space include APPLIED OPTOELECTRONICS, INC. (NASDAQ:AAOI) , Teradyne, Inc. (NYSE:TER) and Applied Materials, Inc. (NASDAQ:AMAT) . All of these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

APPLIED OPTOELECTRONICS has a remarkable average positive earnings surprise of 118.33% for the last four quarters. Teradyne generated an average positive earnings surprise of 25.10% over the trailing four quarters. Applied Materials has delivered an average positive earnings surprise of 3.35% in the past four quarters.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>