NstarNST

Morningstar Rating

Stock Research and Analysis

by Ryan McLean

We think NSTAR will continue to outshine its utility peers as a result of its predictable cash flow and steady growth. We believe its solid record of generating shareholder wealth, conservative business model, and promising future make NSTAR an Read more

Bulls Say

A positive regulatory environment and rate certainty help give NSTAR stable and predictable cash flows.

The company recently raised its dividend by 7.7%, marking the tenth consecutive year of dividend increases. We expect continued mid-single-digit dividend growth for the foreseeable future.

A major underground transmission line will boost the firm's capacity and add $220 million to its rate base.

NSTAR's customer base is a high-quality mix of residential, commercial, and industrial users.

A proposed transmission line that would connect NSTAR's service territory with carbon-free power sources in Quebec holds the potential to boost the next decade's earnings. Read more

Bears Say

So far NSTAR has managed operating expenses impressively, but wage inflation could pressure returns going forward.

Unlike some regions in the country with fast-rising populations, NSTAR's service territory is mature and should see only 1%-2% long-term load growth.

NSTAR's pension and postretirement plans are underfunded. Read more

Strategy

The regulated transmission and distribution business will continue to drive NSTAR's performance. The firm has not ruled out expanding this business through another merger, but it says it will take a Read more

Management

Tom May became CEO of NSTAR in 1999 following BEC Energy's merger with Commonwealth Energy. NSTAR's commendable performance in recent years is attributable in part to May's foresight concerning the synergy and regulatory benefits achievable under a Read more

Profile

NSTAR arose from the merger of BEC Energy and Commonwealth Energy in 1999. NSTAR now operates almost exclusively as an energy transmission and distribution company, serving Read more

First Name

Last Name

Email Address

Zip Code

Create Password

Verify Password

(6-15 characters; case sensitive)

What is your occupation or job title?

Select...

Your registration indicates agreement to the terms of use.

Dividend Raises Back in Vogue
Watch more