Morningstar Rating

Stock Research and Analysis

by Charles Fishman, CFA

Bulls Say

The lowest industrial electricity rates in the South and 30% below the national average are driving strong industrial development in the Mississippi Delta region and electricity sales growth.
Tighter environmental restrictions on coal-fired power plants and potential future restrictions on carbon dioxide emissions make the economics of nuclear power increasingly appealing.
The same storms that hit Entergy's Gulf Coast utilities also tend to send natural gas prices higher, lifting power prices in the Northeast and boosting profits for Entergy's merchant nuclear assets. Read more 

Bears Say

Entergy’s relationship with New York regulators remains strained following their rejection of Entergy's 2010 nuclear fleet spin-off and the current license renewal fight at Indian Point.
Low power prices and lack of local public support for nuclear energy resulted in the decision to close the Vermont Yankee plant at the end of 2014.
The December 2013 Arkansas Public Service Commission decision in the Entergy Arkansas base rate case incorporated a 9.3% return on equity, the lowest ROE awarded to a Southern U.S. utility in years. Read more 

Management

We assign Entergy a standard stewardship rating. This rating is due in large part to our favorable opinion of management's investments in nuclear generating assets and accretive projects at its regulated utilities offset by its poor political and regulatory   Read more 

Profile

Entergy is an integrated utility with approximately 30,000 megawatts of electric generating capacity. Its six regulated utilities generate electricity and distribute power   Read more 

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