Mizuho Securities Remains Sidelined on Duke Energy (DUK) Following 4Q

Mizuho Securities reiterated a Neutral rating on Duke Energy (NYSE: DUK), and cut the price target to $72.00 (from $75.00), following the company's 4Q earnings report. DUK admits that the LatAm sale headline number, if it occurs, will likely disappoint. Chmn and CEO Good expects the sale to be dilutive, even on a reasonable valuation, and that proceeds include the remaining $1.2B in cash repatriation previously contemplated. Also, DUK stated that it plans to issue $500-750M through a forward agreement to pre-fund the equity component of the pending Piedmont transaction.

Analyst James Riesemann commented, "We maintain our cautious stance on DUK following 4Q15. DUK has some challenges: bonus depreciation has eaten into a year's worth of growth; the LatAm sale, if it happens, will likely disappoint; equity needs may continue beyond the forthcoming forward offering; and, current valuation already appears to be positively skewed for the Company's "back to basics" strategy. As such, we continue to see downward pressure and lower our target to $72 on Neutral-rated DUK."

For an analyst ratings summary and ratings history on Duke Energy click here. For more ratings news on Duke Energy click here.

Shares of Duke Energy closed at $74.55 yesterday.

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