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Seaport Global Securities Starts WGL Holdings (WGL) at Neutral

December 2, 2016 8:56 AM EST
Get Alerts WGL Hot Sheet
Price: $88.74 --0%

Rating Summary:
    0 Buy, 5 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
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Seaport Global Securities initiates coverage on WGL Holdings (NYSE: WGL) with a Neutral rating and a price target of $71.00.

Analyst Mark Levin commented, "We initiate coverage of WGL Holdings (WGL) with a Neutral rating and $71 price target. On Tuesday, the stock popped 8.9% (S&P was up 0.1%), as Bloomberg reported WGL's board was mulling a takeover offer from Spain's Iberdrola. This helped push the company's valuation to 21.5x our 2017 EPS estimate and 19.5x our 2018 EPS forecast. In 2015, Duke Energy bought Piedmont Natural Gas for ~30x, and Southern Company purchased AGL for ~23x. If we apply the average multiple of the AGL and Piedmont deals to our 2017 EPS estimate, WGL would be worth ~$90 (23% above yesterday's closing price). While it's impossible to know whether a deal is in the offing or what a potential take-out price might be, we would be hesitant to initiate positions at these levels, especially following the spike in the shares. Absent a deal, we think the stock is fully valued."

For an analyst ratings summary and ratings history on WGL Holdings click here. For more ratings news on WGL Holdings click here.

Shares of WGL Holdings closed at $73.15 yesterday.



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