Jefferies Remains Bullish on Ameren (AEE), Citing EPS Growth and Rising Power Demand

Ameren Corporation (NYSE:AEE) is one of the best high-growth utility stocks to buy. The company was established in 1881 and has its headquarters in Saint Louis, Missouri. Ameren offers electricity and natural gas services through its subsidiaries in Missouri and Illinois. It generates energy from coal, nuclear, natural gas, and renewable sources such as wind, hydro, methane gas, and solar.

On October 20, Jefferies reiterated a Buy recommendation on Ameren while lifting the price target from $121 to $125. The higher price target comes from the firm’s expectation that AEE’s EPS will fall at the upper end of its EPS compound annual growth rate (CAGR) guidance of 6% to 8%.

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Jefferies observed many factors influencing Ameren’s growth, such as new rates in Missouri, return on equity (ROE) dynamics, grid infrastructure spending, Physical Resilience Plan (PRP) capital allocation mix, and rising power demand.

The firm forecasts Ameren’s EPS to increase by a CAGR of nearly 8.2%, topping the market expectation of 7.5%, and mentioned that AEE has already achieved the top half of its FY2025 guidance.

Moreover, Jefferies added that Ameren is trading at a slight premium of 6.2% to its FY 2027 EPS projections, which indicates value compared to local competitors. The investment firm also anticipates good Q3 updates, while noting that a thorough financial report is not expected until Q4.

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