DTE Energy (DTE) PT Lowered to $147 at Guggenheim
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Rating Summary:
15 Buy, 10 Hold, 0 Sell
Rating Trend: Down
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 11
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Guggenheim analyst Shahriar Pourreza lowered the price target on DTE Energy (NYSE: DTE) to $147.00 (from $148.00) while maintaining a Buy rating.
The analyst commented, "DTE hosted a conference call to provide a business update on the Midstream spin-off (DTM), marking the completion of major hurdles to begin trading (incl. SEC) and the distribution date for DTM shares is set for July 1. The incremental updates from the disclosures mainly focus on the DTM growth plan and financial strategy, which largely aligns with prior DTE disclosures and our estimates (as we noted here). DTM will have a near term EBITDA growth rate of 5-7% (2022E), per guidance, capital allocation of $1.2-1.7B for growth and be on path for investment grade (with a degree of flexibility). Aside from organic growth through capex, DTM is also seeing opportunities on re-contracting existing storage and pipeline assets (both tenor and pricing expansion). In aggregate, the DTM updates hold the line on DTE’s historically conservative planning and execution approach, so we anticipate future updates to hold a degree of upside (all else held constant). Using the new disclosures, we update our RemainCo implied valuation, which has ticked up, but we remain Buy rated on our view of aggregate value in the shares with a $147 PT (down from $148). For DTE RemainCo, the 2Q update should present some upside to the current EPS guidance range given strong start to the year."
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