U.S. Markets open in 7 hrs 21 mins

Avista (AVA) Receives PUC Approval for Oregon Rate Case

Zacks Equity Research

Avista Corporation AVA recently received approval for natural gas rate case from the Public Utility Commission of Oregon (PUC). The new gas rates will be effective from Jan 15, 2020.

The bills of residential natural gas customers in Oregon using 47 therms per month on an average will increase 4.5% to $51.13. The approval is going to increase the company’s natural gas revenues by $3.6 million.

Importance of Rate Hike in Utility Space

The companies operating in U.S utilities sector require huge investments in infrastructures on a regular basis to maintain reliable and safe services. The companies spend consistently towards up-gradation and maintenance. Rate hikes enable these companies to recover the invested funds and invest more in the future.

In January 2019, Exelon Corporation EXC received necessary approval from the Maryland Public Service Commission to raise natural gas distribution rates for its customers in the state.

Long-Term Capital Plans

Natural gas, as a primary source of energy, is gaining popularity in the United States on its clean burning property and availability. Per a report from the U.S. Energy Information Administration (EIA), U.S. dry natural gas production will average 91.6 billion cubic feet per day (Bcf/d) in 2019. Production volumes will further increase in 2020 and are expected to average 93.5 Bcf/d. We believe that the company’s natural gas business will gain from these projections.

The company serves 389,000 electric customers and 357,000 natural gas customers. Avista keeps on investing regularly to provide services to these customers efficiently.  After spending $196 million in the first half of 2019, it aims to spend $1.65 billion in the 2019-2022 time period.

Other companies are also making long-term investment plans. NextEra Energy NEE has well-chalked plans to invest nearly $50-$55 billion in different projects over the 2019-2022 period. Duke Energy Corporation DUK has a robust five-year capital plan and currently intends to invest about $37 billion in its overall growth projects for the 2019-2023 period.

Price Performance

In the past six months, shares of Avista have gained 16.6% compared with the industry’s rise of 8.1%.

Zacks Rank & Key Picks

Currently, Avista has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Exelon Corporation (EXC) : Free Stock Analysis Report
NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
Avista Corporation (AVA) : Free Stock Analysis Report
Duke Energy Corporation (DUK) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research