Update shared on04 Sep 2025
Analysts view Hydro One's earnings visibility and strong financial position as supportive, but premium valuation concerns relative to peers have led most to see the stock as fairly valued, with the consensus price target unchanged at CA$49.68.
Analyst Commentary
- Bullish analysts cite Hydro One's 100% electric utility weighting as a key differentiator supporting premium valuation.
- Robust and transparent earnings growth visibility through 2027 is seen as supportive of current price targets.
- Strong financial flexibility reinforces confidence in the company’s ability to manage future investments and returns.
- Despite positive fundamentals, valuation concerns are raised due to Hydro One trading at a premium to nearly all North American utilities and its own historical average.
- Most analysts view the stock as fairly valued at current levels, leading to neutral ratings and only modest price target increases.
What's in the News
- CEO David Lebeter will take a temporary compassionate care leave effective August 25, 2025, and will support the company in an advisory capacity until his return; Harry Taylor has been appointed Interim President and CEO, while retaining his role as EVP, Chief Financial and Regulatory Officer.
- Hydro One reaffirmed guidance for annual EPS growth of 6%-8% through 2027, using normalized 2022 EPS of $1.61 as the base.
- Shareholders approved a special resolution to amend the company's articles of incorporation at the recent AGM.
Valuation Changes
Summary of Valuation Changes for Hydro One
- The Consensus Analyst Price Target remained effectively unchanged, at CA$49.68.
- The Consensus Revenue Growth forecasts for Hydro One remained effectively unchanged, at 2.8% per annum.
- The Future P/E for Hydro One remained effectively unchanged, at 24.33x.
Disclaimer
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