Hall of Famer Steven Fleishman joined Wolfe Research from Bank of America Merrill Lynch in March, and this year marks his 15th appearance on the roster. Although he drops one rung to No. 2, Fleishman continues to “set himself apart with his well-balanced, thoughtful views and his long-standing ability to identify key company-specific and industry-wide issues,” one supporter marvels. The regulated side of the electric utility business is “starting to see a deceleration of growth,” Fleishman says. “Investment opportunities are starting to slow down, and the companies that are accelerating rate-based growth are going to break out in terms of valuation and outperform.” Infrastructure surrounding natural gas represents one area of opportunity, since the commodity is cheap and demand is high. Accordingly, the analyst favors Sempra Energy. Though primarily still a gas and electric utility, the San Diego–based company is in the process of expanding its Cameron liquefied-natural-gas receipt terminal in Louisiana and developing a natural-gas pipeline to deliver cheap gas to Mexico. Another recommendation is NextEra Energy of Juno Beach, Florida, because of its focus on renewables. Calling the company “the premier player” in the wind-power business, Fleishman notes that it has built a backlog of almost 1,000 megawatts of additional projects and has several undeveloped sites. — Carolyn Koo |
The 2013 All-America Research Team: Electric Utilities, No. 2: Steven Fleishman