Chesapeake Utilities (NYSE:CPK) -2% AH after announcing a public offering of common stock with an aggregate value not to exceed $52M, with an underwriters option to purchase up to an additional $7.8M of shares.
CPK says it plans to use the proceeds to pay down part of its short-term revolving debt, which has increased as a result of capital investments to support growth.
Chesapeake Utilities (NYSE:CPK) rose 2.2% in today's trade after Janney upgraded shares to Buy from Neutral with a $71 price target, raised from $59, after reporting better than expected Q2 results and that showed solid Y/Y improvement.
The firm believe CPK's robust investment profile will continue to generate higher earnings, and continued capex should allow for future growth throughout their published forecasts.
Janney adds that its positive forward outlook is strengthened by its belief that projects of size are likely to occur in the coming years as Marcellus Shale gas finds its way south in a more pronounced way to CPK's geographic footprint.
Top 10 Holdings as of 6/30/2016: Middlesex Water Co (MSEX): 1.83792%, Chesapeake Utilities Corp (CPK): 1.83185%, J&J Snack Foods Corp (JJSF): 1.81791%, Northwest Natural Gas Co (NWN): 1.80509%, California Water Service Group (CWT): 1.80402%, Andersons Inc (ANDE): 1.7911%, Connecticut Water Service Inc (CTWS): 1.78364%, York Water Co (YORW): 1.76417%, Urstadt Biddle Properties Inc Class A (UBA): 1.76156%, Spire Inc (SR): 1.75542%
Chesapeake Utilities (CPK +8.6%) is higher after Hilliard Lyons upgrades shares to Long-Term Buy with a $72 price target, citing valuation and strong growth prospects.
The only positive S&P sector in today's trade is utilities, and investors looking for safety today may be attracted by CPK, which consistently produces among the best returns on equity and capital in the industry.
Roughly 80% of CPK's operating income is regulated, providing a predictable cash flow base from which to invest in businesses with higher returns, Hilliard Lyons says.