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1. Company Snapshot

1.a. Company Description

Avista Corporation, together with its subsidiaries, operates as an electric and natural gas utility company.It operates in two segments, Avista Utilities and AEL&P.The Avista Utilities segment provides electric distribution and transmission, and natural gas distribution services in parts of eastern Washington and northern Idaho; and natural gas distribution services in parts of northeastern and southwestern Oregon, as well as generates electricity in Washington, Idaho, Oregon, and Montana.


This segment also engages in the wholesale purchase and sale of electricity and natural gas.The AEL&P segment offers electric services to 17,400 customers in the city and borough of Juneau, Alaska.The company generates electricity through hydroelectric, thermal, and wind facilities.


As of February 23, 2022, it provided electric service to 406,000 customers and natural gas to 372,000 customers.In addition, the company engages in venture fund investments, real estate investments, and other investments.Avista Corporation was incorporated in 1889 and is headquartered in Spokane, Washington.

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1.b. Last Insights on AVA

Avista Corporation's recent performance was driven by several positive factors. The company's substantial capital expenditure plans and favorable rate cases are expected to drive significant earnings growth and higher returns on equity. Additionally, Avista's decision to increase its quarterly dividend by 3% to $0.49 per share, yielding an annualized dividend of $1.96, provides a attractive income stream for investors. The company's commitment to environmental, social, and governance (ESG) initiatives, as shown in its updated corporate responsibility report, also suggests a positive evolution of business conditions.

1.c. Company Highlights

2. Avista Corporation's 2025 Earnings: A Year of Strategic Progress

Avista Corporation reported consolidated earnings of $2.38 per diluted share for 2025, up from $2.29 in 2024. Non-GAAP utility earnings were $2.55 per diluted share, compared to $2.38 per diluted share in 2024. The company's financial performance was marked by steady operational execution and cost management, as noted by Kevin Christie, "Our utility earnings in 2025 reflect the strength of our operational execution and continued cost management." Revenue growth is expected to be around 3.8% next year, according to analyst estimates.

Publication Date: Feb -26

📋 Highlights
  • Earnings Growth: 2025 consolidated earnings rose to $2.38/share (+3.9% YoY) with non-GAAP utility earnings at $2.55/share (+6.7% YoY).
  • 2026 Guidance: Initiated non-GAAP utility earnings guidance of $2.52–$2.72/share, incorporating $0.12 one-time impact from a large industrial customer loss and $0.10 from energy recovery mechanisms.
  • Energy Assistance Expansion: Program reach quadrupled over two years, aiding four times more customers compared to 2023 levels.
  • ROE Target Increase: Long-term expected return on equity at Avista Utilities raised to ~9% (excludes energy recovery impacts) from prior expectations.

Operational Highlights

The company made significant strides in expanding its energy assistance programs, increasing its reach to four times as many customers in need over the last two years. Avista also filed a four-year rate plan with the Washington Utilities and Transportation Commission, addressing rising costs related to grid modernization and clean energy compliance.

Guidance and Outlook

Avista initiated non-GAAP utility earnings guidance for 2026, with a range of $2.52 to $2.72 per diluted share. The guidance includes an expected one-time decrease of $0.12 due to a large industrial customer's departure. The company is raising its long-term expected return on equity at Avista Utilities to approximately 9%, excluding any impact from the energy recovery mechanism.

Valuation and Growth Prospects

With a P/E Ratio not available due to 'None' actual eps, the stock's valuation is more appropriately assessed using other metrics. The P/S Ratio stands at 2.46, indicating a moderate valuation relative to sales. The EV/EBITDA ratio is 12.42, suggesting a reasonable valuation relative to earnings before interest, taxes, depreciation, and amortization. The Dividend Yield is 4.83%, attractive for income-seeking investors. Avista's long-term EPS CAGR is expected to be in the range of 4-6%, correlating with a 5% rate base CAGR, and potentially reaching the top end of this range if a 12% rate base CAGR is achieved.

Investment and Funding Strategy

Avista's management discussed potential large load customer investments, with an internal go-or-no-go threshold of around $250,000,000 for incremental build. The company would reassess its debt and equity issuance based on additional capital investment opportunities, potentially using a 50-50 debt and equity funding approach for the potential $350,000,000 upside CapEx.

3. NewsRoom

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PG&E, Algonquin Power and Avista Are Drawing New Analyst Interest in the Utility Sector

Mar -09

Source: 247wallst.com

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Avista Corporation (AVA) Q4 2025 Earnings Call Transcript

Feb -25

Source: seekingalpha.com

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Avista Corp. Reports 2025 Financial Results, Initiates 2026 Utility Earnings Guidance

Feb -25

Source: globenewswire.com

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Avista Makes Annual Price Adjustment Filing in Idaho

Feb -14

Source: globenewswire.com

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Avista Corp. Board Increases Common Stock Dividend

Feb -10

Source: globenewswire.com

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AVA vs. OGE: Which Stock Should Value Investors Buy Now?

Feb -09

Source: zacks.com

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Korea Electric Power (NYSE:KEP) vs. Avista (NYSE:AVA) Head-To-Head Review

Feb -09

Source: defenseworld.net

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Are Utilities Stocks Lagging Algonquin Power & Utilities (AQN) This Year?

Feb -03

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.99%)

6. Segments

Avista Utilities

Expected Growth: 3.0%

Avista Utilities' 3.0% growth is driven by increasing electricity and natural gas demand from residential and commercial customers, rate base growth through infrastructure investments, and favorable regulatory environments. Additionally, the company's focus on renewable energy sources and grid modernization efforts contribute to its growth momentum.

Alaska Electric Light and Power Company

Expected Growth: 2.5%

Alaska Electric Light and Power Company's 2.5% growth is driven by increasing demand for electricity in the residential and commercial sectors, fueled by Alaska's growing population and economy. Additionally, investments in grid modernization and renewable energy sources, such as wind and hydroelectric power, are expected to contribute to the company's growth.

Other

Expected Growth: 2.0%

Avista Corporation's 2.0% growth in 'Other' segment is driven by increasing demand for infrastructure services, expansion of electric transmission lines, and growing investments in renewable energy sources. Additionally, favorable regulatory environments and cost savings initiatives contribute to the segment's growth.

7. Detailed Products

Electricity

Avista Corporation provides electricity to residential, commercial, and industrial customers in the Pacific Northwest region of the United States.

Natural Gas

Avista Corporation delivers natural gas to customers in Washington, Idaho, and Oregon, providing a clean and efficient source of energy.

Energy Efficiency Services

Avista Corporation offers energy efficiency services, including energy audits, rebates, and incentives, to help customers reduce energy consumption and costs.

Renewable Energy Solutions

Avista Corporation provides renewable energy solutions, including wind, solar, and hydroelectric power, to customers seeking sustainable energy options.

Transmission and Distribution Services

Avista Corporation operates and maintains a vast network of transmission and distribution lines, ensuring reliable and efficient energy delivery.

8. Avista Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Avista Corporation's threat of substitutes is moderate due to the availability of alternative energy sources such as solar and wind power. However, the company's strong brand presence and customer loyalty mitigate this threat to some extent.

Bargaining Power Of Customers

Avista Corporation's customers have low bargaining power due to the company's dominant market position and lack of alternative energy providers in the region.

Bargaining Power Of Suppliers

Avista Corporation's suppliers have moderate bargaining power due to the availability of alternative suppliers in the market. However, the company's long-term contracts with suppliers mitigate this threat to some extent.

Threat Of New Entrants

The threat of new entrants is low for Avista Corporation due to the high barriers to entry in the energy industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in the energy industry is high due to the presence of several established players, including Avista Corporation. The company faces intense competition from other energy providers, which can lead to pricing pressures and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 54.97%
Debt Cost 3.95%
Equity Weight 45.03%
Equity Cost 6.33%
WACC 5.02%
Leverage 122.06%

11. Quality Control: Avista Corporation passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Avista

A-Score: 6.9/10

Value: 7.1

Growth: 4.2

Quality: 4.6

Yield: 8.0

Momentum: 7.5

Volatility: 10.0

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NorthWestern

A-Score: 6.8/10

Value: 6.3

Growth: 3.3

Quality: 5.3

Yield: 8.0

Momentum: 8.5

Volatility: 9.7

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Otter Tail

A-Score: 6.7/10

Value: 5.1

Growth: 7.0

Quality: 6.5

Yield: 6.0

Momentum: 7.0

Volatility: 8.7

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Black Hills

A-Score: 6.7/10

Value: 5.3

Growth: 4.2

Quality: 4.4

Yield: 8.0

Momentum: 8.0

Volatility: 10.0

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ALLETE

A-Score: 6.5/10

Value: 5.7

Growth: 3.9

Quality: 4.4

Yield: 8.0

Momentum: 7.0

Volatility: 10.0

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AES

A-Score: 6.0/10

Value: 7.2

Growth: 5.4

Quality: 3.8

Yield: 8.0

Momentum: 7.0

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

39.67$

Current Price

39.67$

Potential

-0.00%

Expected Cash-Flows