Spire: Missouri Is A 'Swing State' That Could Turn Performance From 'Mediocre To Marvelous'

Last month Spire Inc SR reported a higher-than-expected loss for its fiscal fourth quarter.

The current Street expectations do not fully reflect the company's 2025 rate case, which is likely to go into effect in early fiscal 2026, according to Mizuho Securities.

Analyst Gabriel Moreen upgraded the rating on Friday for Spire from Neutral to Outperform, while raising the price target from $65 to $76.

The Spire Thesis: Investor sentiment for Spire Missouri could turn positive, as uncertainties reduce, Moreen said in the upgrade note.

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"Although the relationship between Spire Missouri and its regulators has experienced periodic volatility, we believe there are reasons for a constructive case outcome," he added.

Spire Missouri, which accounts for around 45% of Spire's total operating income, delivered significantly lower returns from fiscal 2022 to 2024 than it had averaged over the preceding three years, the analyst stated. Even if the subsidiary earns around 8.1%, which is still below the average, "it would rebase Missouri growth to a y/y +30% net income increase into FY26," he further noted.

With this, Spire's target of 5%-7% CAGR (compounded annual growth rate) "could finally prove sustainable and narrow the expanding valuation gap between SR and its LDC peers," Moreen added.

SR Price Action: Shares of Spire remained broadly flat at around $66.69at the time of publication on Monday.

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Photo courtesy Spire, Inc.