SSE Earnings: Growth Target Is Raised on Higher Investments and Power Prices

No-moat SSE released fiscal 2023 results above expectations and set 2024 and 2027 guidance well above ours due to higher investments and power prices assumptions. The firm will pay a GBX 96.7 dividend on fiscal 2023 earnings, in line with the average annual U.K. retail price index rate, that is 12.9% higher than in fiscal 2022. SSE unexpectedly raised its dividend growth target from at least 5% to between 5% and 10% after the rebase to GBX 60 in fiscal 2024. This reflects an improving financial headroom thanks to higher earnings growth than expected.