In this series, we’ve discussed the biggest utility stocks by market capitalization. We’ll look at Xcel Energy (XEL) in this part. Xcel Energy stock has rallied recently and is close to its 52-week high. This year, it has risen more than 10%. Xcel Energy’s significant exposure to regulated operations stabilizes its earnings and dividends. To learn more, read How Xcel Energy’s Dividend Profile Compares to Peers.
Xcel Energy’s forward PE ratio is 20x based on its estimated 2019 EPS, higher than overall utilities’ average of 17x and its own five-year historical average of ~18x. As analysts expect Xcel’s earnings to grow ~5% in 2019, the stock appears to be trading at a premium.
Analysts’ median target price of $51.23 for Xcel implies a ~4% downside to its current market price of $53.21 over the next year. Of the 15 analysts tracking Xcel Energy, 11 recommend “hold,” two recommend “strong buy,” and two recommend “buy.” None recommend “sell.”