Are Analysts Right in Thinking Avista Corporation (AVA) Stock Could Soon Worth $46.5?

Over the past 12 fiscal quarters, Avista Corporation (NYSE:AVA) has topped consensus earnings estimates in 5 quarters (41%), missed earnings in 6 quarters (50%), whereas at 1 occasion EPS met analyst expectations. Shares of Avista Corporation (AVA) have dropped -1.2% since the company’s last earnings report.AVA last reported earnings on November 07, 2018 when it released Sep-18 results that receded expectations. The company raked in $0.15 per share, -99.29% change on the same period last year. That was worse than consensus for $0.19. Revenue for the recent quarter stood at $409.36 million, up 2% on last year and below the $429.8 million predicted by analysts. For this quarter, Wall Street analysts forecast revenue in a range of $1.45 billion to $1.45 billion, which should be compared with $0 generated last year. EPS is seen in a range of $2.05 to $2.05, against the $2.07 reported a year ago.

AVA’s 50 day simple moving average (SMA 50) price is $51.48 and its 200-day simple moving average (SMA 200) price is $51.43. The company’s stock currently has a total float of 65.02M shares. Its weekly volatility is hovering around 1.31% and felt 0.7% volatility in price over a month. On the upside, the share price will test short term resistance at around $45.25. On a downside, the stock is likely to find some support, which begins at $43.59. The failure to get near-term support could push it to $42.49.

Separately, it has been reported that multiple insider activity took place at Avista Corporation (AVA). Vice President Christie Kevin J sold 100 shares for $11,176 in transaction occurred on 2018/09/13. After making this transaction, the Vice President owns a direct stake of 5,110 shares, worth $499,344, as per the last closing price. On 2018/08/31 Kensok James M, Vice President at AVA, dumped 500 shares at an average price of $51.26 per share. The selling total is valued at $401,539.

Vice President, Christie Kevin J had divested 380 shares for $11,276 through a trade on 2018/08/30. Following this activity, the insider holds 19,433 shares worth $503,812 as of recent close. Wall Street’s most bullish Avista Corporation (NYSE:AVA) analysts are predicting the share price to blow past $53 per share during the next 12 months. The current median share price forecast by them is $46.5, suggesting that the stock could increase 4.07% in that time frame. The average price target of $46.5 calls for a nearly 4.07% increase in the stock price.

It had seen a change in price target from analysts at Williams Capital Group, who reiterated the stock at Sell on February 22 but moved PT from $42 to $40. Analysts at Williams Capital Group, shed their positive views on July 20 by lowering it fromHold to Sell. Brokerage firm Williams Capital Group, looks cautious as they stick to prior recommendation of Hold, in a call on February 23. However, they did change the target price from $38 to $37. Mizuho, reiterated their call for Neutral, on February 23. On the other hand, they had set new target price to $37 versus $41.

When looking at valuations, Avista Corporation (AVA) has a pricey P/E of 22.9x as compared to industry average of 22.8x. Moreover, it trades for 20.17 times the next 12 months of expected earnings. Also, it is trading at rather expensive levels at just over 1.68x price/book and 2.07x price/sales. Compared to others, Avista Corporation is in a different league with regards to profitability, having net margins of 8.3%. To put some perspective around this, the industry’s average net margin is 38.45%. AVA’s ROE is 6.8%, which is also considerably worse than the industry’s ROE of 12.04%. It’s also not liquid in the near term, with a current ratio of 0.7. The stock has a debt/capital of 1.11.

Avista Corporation (NYSE:AVA) recently claimed $2.94B as the price has approached $44.68. There came a -13.06% decline with the closing bell on Thursday. The stock remained range bound between $43.065 and $44.73. Trading activity significantly improved as the volume at ready counter increased to 11,546,693 shares versus 1,274,710 in average daily trading volume over the past 20 days. So far this year, the volume has averaged about 566,907 shares. The stock is now -5.94% above against its bear-market low of $47.5 on December 06, 2018. It has retreated -18.42% since it’s 52-week high of $52.91 reached in July. Now the market price is down -13.6% on the year and down -13.23% YTD.