NWE
Northwestern Energy Group Inc
$71.93
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 38.7% above fair value
You pay
$71.93
Bear
$45.38
Fair
$51.86
Bull
$58.35
Bear
$45.38
-36.9%
$2.94 × 14x P/E
Fair
$51.86
-27.9%
$2.94 × 16x P/E
Bull
$58.35
-18.9%
$2.94 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
24.5x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $66.33 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $51.86 per share.
Warnings
The company pays out 90% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $66.33 (from 18 analysts). Our estimate is 29% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples