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Xcel Energy (XEL) Hits 52-Week High on Strong Q2 Earnings

Zacks Equity Research

Xcel Energy Inc. XEL scaled a new 52-week high of $49.22 during the trading session on Aug 18, before eventually closing a tad lower at $49.00. The stock has delivered a one-year return of about 15.0% compared with industry’s gain of 4.0%.

In the past 52 weeks, Xcel Energy’s share price has ranged from a low of $38.00 to a high of $49.22. Average volume of shares traded in the last three months is approximately 2.6 million.

Why an Upward Trend?

Xcel Energy’s shares have been on the rise following strong second-quarter 2017 results released on Jul 27. The company reported earnings of 45 cents per share, beating the Zacks Consensus Estimate of 43 cents by 4.6%. Earnings were 15.4% higher than the year-ago quarter. All the segments of the company, namely electric, natural gas and others, saw a year-over-year rise in revenues.

The company has been a consistent performer having delivered positive earnings surprises in three of the trailing four quarters with an average surprise of 1.09%. The long-term earnings growth of the company is presently pegged at 5.43%.

Xcel Energy is currently diversifying its generation portfolio with emphasis on renewable sources. The company is planning to invest about $3.5 billion in renewables over the next five years. The 600 megawatt (MW) Rush Creek wind project in Colorado has been approved by the Colorado Public Utilities Commission in September and is expected to come online in 2018.

The sign of economic development across the company’s service territory, especially in Minnesota, in comparison to the nation as a whole has been effective in boosting the company’s performance. Additionally, the settlement in the Minnesota Multiyear Rate Plan and resolved regulatory proceedings in Texas, New Mexico and Wisconsin has been a growth driver for the company.

Zacks Rank & Stocks to Consider

Xcel Energy currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space are Atlantica Yield PLC ABY sporting a Zacks Rank #1 (Strong Buy) and CenterPoint Energy, Inc. CNP and Ameren Corporation AEE, both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Atlantica Yield PLC delivered second-quarter 2017 earnings of 24 cents per share, beating the Zacks Consensus Estimate of 11 cents by 118.18%. The company’s 2017 estimates have increased by 11 cents to 62 cents per share in the last 60 days.

CenterPoint Energy, Inc. delivered second-quarter 2017 earnings from operations of 29 cents, beating the Zacks Consensus Estimate of 21 cents by 38.10%. The company’s 2017 estimates have increased by 2 cents to $1.31 in the last 60 days.

Ameren Corporation delivered second-quarter 2017 earnings from operations of 79 cents, beating the Zacks Consensus Estimate of 69 cents by 14.49%. The company’s 2017 estimates have increased by 3 cents to $2.80 in the last 60 days.

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