BofA Securities Starts SJW Corp. (SJW) at Neutral

BofA Securities analyst Ross Fowler initiates coverage on SJW Corp. (NYSE: SJW) with a Neutral rating and a price target of $65.00.

The analyst comments "We are initiating coverage of SJW at Neutral with a $65 price objective. SJW currently trades at a 15%+ discount to the average US water group P/E, despite an improving earnings quality mix and more transparent investor communications. We initiate at a Neutral rating despite the discount to reflect uncertainty around potential future acquisitions and a perceived degradation in the Connecticut regulatory environment. SJW is arguably a sub-scale operator when compared to the major US water utilities (SJW <$2bn market cap; AWK ~$30bn) and likely aspires to increase scale to improve O&M efficiencies and ultimately improve earnings consistency. We do not assume any incremental acquisitions or strategic changes to SJW in our earnings forecasts and model 24e/25e/26e EPS of $2.71/$2.92/$3.06 (vs consensus of $2.76/$2.96/$3.10)."

For an analyst ratings summary and ratings history on SJW Corp. click here. For more ratings news on SJW Corp. click here.

Shares of SJW Corp. closed at $59.97 yesterday.

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