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Dominion Hits 52-Week High on Returns from Steady Investment

Zacks Equity Research

Share price of  Dominion Energy, Inc. D, an electric and power company, hit a new 52-week high of $79.83 on May 22, finally closing a tad lower at $79.70. The stock has delivered a one-year return of about 18.1% compared with the Zacks categorized Utility - Electric Power industry’s gain of 7.1%.

Over the past 52 weeks, Dominion‘s share price has ranged from a low of $69.59 to a high of $79.83. Average volume of shares traded in the last three months is approximately 2.3 million.

Factors behind the Performance

Dominion’s shares have been on the rise following strong first-quarter 2017 results that were declared on May 4. The company posted earnings per share of 97 cents, beating the Zacks Consensus Estimate of 96 cents by 1.04%. Reported earnings were also up by the same rate year over year.

The company has been a consistent performer, having delivered positive earnings surprises in three out of the trailing four quarters with average surprise of 2.42%. The long-term earnings growth of the company is presently pegged at 6%.

Secured earnings from regulated assets will drive Dominion’s earnings growth. The company expects electric sales to continue to improve by at least 1% each year. The company has decided to invest nearly $13–$15 billion during the 2017–2020 time period in various growth projects.

Dominion will benefit from its Greensville County Power Station and Cove Point Liquefaction projects that are proceeding on time and budget. Additionally, the company is also developing over 3 billion cubic feet per day of gas infrastructure projects. All these projects are likely to boost the performance over the long term.

The company expects to receive $7–$8 billion of cash between 2016 and 2020 from Dominion Midstream Partners, which will be utilized to lower debts, invested in growth projects, and to pay dividends & repurchase shares.

Dominion Resources, Inc. Price and Consensus

 

Dominion Resources, Inc. Price and Consensus | Dominion Resources, Inc. Quote

Stocks to Consider

Dominion currently carries a Zacks Rank #3 (Hold). Investors can consider better-ranked stocks from the same industry like Algonquin Power & Utilities Corp. AQN, Avangrid, Inc. AGR and Great Plains Energy Inc GXP. All the three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

Algonquin Power & Utilities reported a positive earnings surprise of 11.76% in the first quarter of 2017. Its 2017 estimates have risen by 9.3% to 47 cents per share in the last seven days.

Avangrid reported a positive earnings surprise of 7.35% in the first quarter of 2017. Its 2017 estimates have risen by 0.5% to $2.21 per share in the last 60 days.

Great Plains Energy reported a positive earnings surprise of 8.33% first quarter of 2017. Its 2017 estimates have risen by 1.1% to $1.76 per share in the last 30 days.

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