Company Reports

The Maricopa County Superior Court on Sept. 3 issued a stay of the Arizona Corporation Commission's implementation of a new formula rate plan to set customer rates for the state's utilities, including Pinnacle West subsidiary Arizona Public Service.

Pinnacle West reported earnings per share of $1.43 in the second quarter, down from $1.58 during the same period in 2025. Earnings are on track to meet our full-year expectations and management's guidance.

Pinnacle West reported earning $0.27 per share in the first quarter, up from a $0.04 loss during the same period in 2025. Earnings are on track to meet or beat our full-year expectations and management's guidance primarily due to exceptionally warm winter weather.

Arizona's fast-growing population and data center development combined with improving rate regulation in the state should give investors more confidence in Pinnacle West's earnings growth potential.

Pinnacle West reported full-year 2025 earnings per share of $5.05, down 4% from 2024 primarily due to cooler summer weather that reduced electricity demand. This was in line with our expectations and management's guidance.

Arizona's fast-growing population and data center development potential are helping Pinnacle West ride through the state's history of turbulent utility rate regulation.

Pinnacle West reported earnings per share of $3.39 in its third quarter, mostly flat with the year-ago quarter. Core performance is on track to exceed our full-year outlook and management's midyear guidance.

Pinnacle West reported $1.58 earnings per share during the second quarter, down from $1.76 during the second quarter of 2024. Core performance remains on track with our full-year outlook and management's guidance.

Pinnacle West filed a request with Arizona regulators on June 13 to raise electric rates by $579.52 million, or 14%, effective mid-2026. The request uses a 2024 base year and includes a 10.7% allowed return on equity, an increase from the 9.55% allowed ROE used for current rates.

Arizona's fast-growing population and economy have helped Pinnacle West ride through a recent history of turbulent state utility rate regulation. However, regulation appears to be turning more constructive, giving Pinnacle West an opportunity to execute its growth plan.

Pinnacle West reported a $0.04 per share loss during the first quarter, down from a $0.15 gain during the first quarter of 2024. Several timing items resulted in the large year-over-year earnings variance. Core performance remains on track with our full-year outlook and management's guidance.

Utilities have limited direct exposure to tariffs announced by the Donald Trump administration, but falling energy demand or regulatory pushback to utilities' investment plans could slow earnings growth if economic conditions deteriorate.

Arizona's fast-growing population and economy have helped Pinnacle West ride through a recent history of turbulent state utility rate regulation. However, regulation appears to be turning more constructive, giving Pinnacle West an opportunity to execute its growth plan.

Pinnacle West reported $5.24 earnings per share in 2024, up from $4.41 in 2023. This was higher than our estimate and management's $5.00-$5.20 EPS guidance due to additional weather benefits in the fourth quarter and higher-than-expected electricity demand growth.

Population growth and economic growth in Arizona have helped Pinnacle West ride through a turbulent couple of years dealing with state regulators. However, state rate regulation appears to be turning positive. Pinnacle West could be on the verge of another long run of attractive earnings growth and dividend increases.

Pinnacle West announced CEO Jeff Guldner will retire in March 2025 and be replaced by current Arizona Public Service President Ted Geisler. This comes one week after Arizona utilities regulators took a key step toward instituting formula ratemaking, a major reform.

Population growth and economic growth in Arizona have helped Pinnacle West ride through a turbulent couple of years dealing with state regulators. Some of those regulatory setbacks have reversed and Pinnacle West could be on the verge of another long run of attractive earnings growth and dividend increases.

Pinnacle West is on track to top our full-year 2024 earnings outlook after reporting $3.37 per share of earnings during the third quarter, down slightly from the third quarter of 2023. Management reaffirmed its $5.00-$5.20 EPS guidance range.

We reaffirm our fair value estimates and economic moat ratings for US utilities as we assess how they might be affected by renewed interest in nuclear power, particularly small modular reactors. This comes after Google and Amazon announced SMR partnerships this week.

Population growth and economic growth in Arizona have helped Pinnacle West ride through a turbulent couple of years dealing with state regulators. Some of those regulatory setbacks have reversed and Pinnacle West could be on the verge of another long run of attractive earnings growth and dividend increases.