FBR Capital Maintains an 'Underperform' on Duke Energy (DUK); Off to the Races, but Destination Uncertain

FBR Capital maintains an 'Underperform' on Duke Energy (NYSE: DUK), raises PT from $17 to $18.50.

FBR analyst says, "After reviewing our earnings estimates for Duke, we remain hard pressed to see long-term earnings growth on a standalone basis. While the merger with Progress makes strategic sense to us and likely improves the portfolio of opportunities for Duke, we still do not see 4%–6% EPS growth on a combined basis. And yet, DUK currently trades at a 13.5x forward P/E consistent with faster growing peers. Thus, we are maintaining our rating at this time. We are, however, raising our price target to $18.50 as we increase our EPS estimates for stronger expected performance at Commercial Power and expand our target multiple to 13.0x since multiples for the regulated group have expanded since our last publication."

For more ratings news on Duke Energy click here and for the rating history of Duke Energy click here.

Shares of Duke Energy closed at $18.78 yesterday.

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