Avangrid's Positive Shift: KeyBanc Upgrades Stock Amid Market Optimism

KeyBanc Capital Markets analyst Sangita Jain upgraded Avangrid Inc AGR to Sector Weight from Underweight.

The upgrade is owing to the analyst seeing the company valuation moving toward the large-cap group average.

Jain notices the risks related to the pending catalysts, such as the merger with PNM Resources, Inc. (Holding Co.) PNM and restructuring of offshore wind PPAs, as actively priced in by the market.

The analyst expects a new project timeline to be soon revealed for construction at AGR's New England Clean Energy Connect transmission project, which received a green flag from the court last month.

Jain sees the constructive settlements in NY and ME as a potentially positive turning in the regulatory relationship.

The analyst raised estimates for revenues to $8.680 billion (from $8.619 billion and consensus: $8.096 billion) in 2023 and $8.812 billion (from $8.660 billion and consensus: $8.631 billion) in 2024.

On the other hand, Jain reduced the estimate for EPS (net) to $2.20 (from $2.21, consensus: $2.15) in 2023 and $2.32 (from $2.36, consensus: $2.31) in 2024. 

Price Action: AGR shares are trading higher by 1.02% at $38.28 on the last check Wednesday.