MDU Resources Group MDU announced that it plans to make capital investments worth $3.1 billion during 2025-2029, up 15% from that intended for 2024-2028. This planned capital investment reflects MDU’s commitment to providing safe and reliable service to its electric, natural gas and pipeline customers.
Over the next five years, MDU Resources plans to invest 47% more in its natural gas and electric distribution businesses than it did during 2020-2024. In order to efficiently serve an expanding customer base (expected to increase 1-2% per year), these expenditures will be dedicated to building substations, electric transmission lines and natural gas distribution infrastructure.
The company intends to invest nearly $1.18 billion and $1.41 billion in the electric and natural gas distribution segments, respectively. MDU aims to spend $473 million in pipeline business. The company looks forward to replacing and modernizing the existing electric and natural gas utility infrastructure to enhance service reliability.
The combined rate base for the natural gas and electric distribution divisions is anticipated to witness a compound annual growth rate of 7-8% through 2029, higher than 7% anticipated previously.
MDU Resources notifies necessary changes after reviewing its capital plans on a regular basis. As a result of the expansion of the company’s capital program, the requirement for an equity issue to fund growth is now expected in 2026 rather than 2027. With the improved capital investment strategy, the business is still dedicated to achieving its long-term earnings per share (EPS) growth goal of 6-8%. Changes in load growth, regulatory decisions, or other reasons may cause actual expenses to deviate from estimates.
In the past year, shares of the company have risen 1.4% compared with the industry’s 25.2% growth.
Image Source: Zacks Investment Research
The company currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks from the same sector are Atmos Energy Corporation ATO, New Jersey Resources NJR and DTE Energy DTE, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Atmos Energy’s long-term (three to five-year) earnings growth rate is 7%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year increase of 4.8%.
The Zacks Consensus Estimate for New Jersey Resources’ fiscal 2024 EPS indicates a year-over-year increase of 10.1%. The Zacks Consensus Estimate for fiscal 2024 sales indicates a year-over-year decline of 7.9%.
DTE Energy’s long-term earnings growth rate is 8.04%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year increase of 17.8%.