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Posted On: 03/29/2018 9:43:58 PM
Post# of 27084
$DUK Duke Energy is little changed even after Goldman Sachs downgrades shares to Sell from Neutral with a $78 price target, trimmed from $84, citing valuation and estimated future equity needs arising from high leverage levels.
Goldman forecasts DUK to issue ~$5.5B in total new common equity during 2018-20 to improve FFO/debt levels to nearly 13% and keep net debt/EBITDA metrics closer to peer group averages; equity issuance also will weigh on earnings, and Goldman lowers its DUK EPS estimates for 2018-20.
"We expect equity financing needs to remain an overhang and therefore weigh on DUK's P/E multiple - driving our target multiple 8% below our baseline for regulated utilities," the firm says.
Goldman forecasts DUK to issue ~$5.5B in total new common equity during 2018-20 to improve FFO/debt levels to nearly 13% and keep net debt/EBITDA metrics closer to peer group averages; equity issuance also will weigh on earnings, and Goldman lowers its DUK EPS estimates for 2018-20.
"We expect equity financing needs to remain an overhang and therefore weigh on DUK's P/E multiple - driving our target multiple 8% below our baseline for regulated utilities," the firm says.
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