PNM Analyst Day (December 2016)

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Market Price (10/28/2016): $32.55/share; ST-Target: $42/share; NIV: $68/share

PNM: Strong CAGR in AEPS should drive momentum to upside

  • PNM 2017 Guidance of $1.77-$1.87 is in-line with our estimate of $1.85, but more importantly, in-line with the company’s long-term expectations and plan
    • Upgraded 2016 AEPS guidance to $1.60-$1.65/share from $1.55-$1.65/share, below our estimate of some $1.69/share, which we are comfortable with at this time
  • Earnings CAGR target of some 7%-8% through 2019 is still intact, as expected, and accelerated dividend growth seems intact as well, again, as expected
  • 2020 preliminary capex plan of $404MM introduced, subject to rate cases, customer load growth, regulatory construct and constraints, economic and demographic conditions, among others
  • Looking at additional generation development, particularly in wind and solar
  • Customer growth in PNM’s more than offset by energy efficiency and load management programs

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