Morningstar Rating

Stock Research and Analysis

by Mark Barnett

Bulls Say

Regulatory reforms that were signed into law in 2008 seem to have staying power, though the decoupling mechanism was struck down by a judge.
Michigan's aging utility infrastructure needs investment, which will mean regulated growth opportunities for DTE.
DTE's existing gas pipeline footprint provides opportunities to add midstream infrastructure around the Marcellus and possibly Utica shale plays. Read more 

Bears Say

We expect the aggressive self-implement and subsequent refund game to continue, possibly leading to regulatory fatigue or ill will. Tellingly, DTE hopes to stay out of a full rate case for the next few years.
Michigan--especially Detroit--continues to struggle economically, which will increase pressure on regulators to keep electric and gas rates low at the utilities' expense even with securitization charges rolling off.
DTE's nonregulated businesses constitute a significant portion of earnings, making the company a riskier investment than other fully regulated utilities. Read more 

Management

We think DTE merits a Standard Stewardship Rating. Almost all of DTE's executives have been with the company since Michigan deregulated its utilities in 1997. That includes CEO Gerry Anderson, who picked up the mantle after serving as COO since 2005   Read more 

Profile

DTE Energy owns two regulated utilities: Detroit Edison and DTE Gas. Detroit Edison is the nation's 12th-largest electric utility, supplying energy to 2.1 million customers   Read more 

Opportunities Emerge in Beaten-Down Utilities 
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