- South Jersey Industries (SJI -0.2%) is initiated with a Neutral rating and $31 price target at J.P. Morgan, which believes the company's shares reflect appropriate risk to earnings out to 2020.
- JPM thinks utility capital and FERC regulated projects create growth potential for SJI in excess of many gas utility peers and are the main building blocks of a "not unrealistic" $150M net income target by 2020, but dependence on rate cases, shifting pipeline approval schedules and contributions from projects not yet approved add timing and other risk to the growth outlook.
- As a result, the firm views growth as more heavily weighted toward the end of the 2016-20 period and expects shares reflecting this risk at the current level.