UPDATE: Barclays Upgrades OGE Energy (OGE) to Equalweight

Barclays analyst Eric Beaumont upgraded OGE Energy (NYSE: OGE) from Underweight to Equalweight with a price target of $37.00 (from $33.00).

The analyst comments "The new $37 price target (previous $33) reflects a higher group average 2023 P/E multiple of 18.5x versus 17x used in our previous methodology. We reiterate the 10% discount to the group average P/E multiple on 2023E EPS: The discount reflects OGE's below-peer average growth rate and an average to below average regulatory exposure. We see clear signs that the OK regulatory compact is improving (rider approvals, general constructive approach from commission); however, the legacy regulatory lag still exists and limits OGE's ability to earn its authorized returns. The test year construct also requires frequent rate cases in the absence of load growth, though load growth is expected to accelerate following COVID-19 impacts to oil patch exposure and a generally positive economic outlook for OGE's service territory. We continue to view the 4% -6% EPS CAGR guidance as below the average utility growth opportunity and do not see regulatory appetite or aggressive renewable policy as likely to allow for incremental capital to boost the growth rate over the near-term."

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

Shares of OGE Energy closed at $33.91 yesterday.

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