Credit Suisse upgrades Pinnacle West as SCR appeal strengthens case for EPS inflection

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• Credit Suisse on Tuesday upgraded Pinnacle West Capital (NYSE:PNW) to Outperform from Neutral as a recent court ruling in a case regarding SCR equipment strengthens the case for EPS inflection.
• An Arizona appeals court ruled that Pinnacle (PNW) can increase its rate of return to 8.9% from 8.7% and approved costs that had been disallowed for SCR equipment.
• "We believe EPS expectations are poised to inflect for shares given several positive updates including: court remand of the Arizona Corporation Commission's SCR decision and ROE reduction, and higher three-year capEx of $5.32B from prior $4.7B," said analyst Nicholas Campanella.
• "We see further room for outperformance with the stock still trading at a 6% P/E discount on our 2025E outlook in addition to what we're viewing as a structural shift in the operating environment," he added.
• Credit Suisse raised its price target on Pinnacle (PNW) to $80 from $77, implying 2.1% potential upside to its last close.
• The research firm's stance contrasts Hold ratings by SA Quant as well as Wall Street analysts.

Comments

[bill h illify]

We shall see.