BofA Lowers PPL Stock Price Target to $42 Amid Earnings Insights

BofA Adjusts Price Target#

BofA Securities has lowered its price target for PPL Corp (NYSE:PPL) from $43 to $42, while still maintaining a Buy rating on the utility company. PPL Corp has a market capitalization of $28.94 billion and is currently trading above what is considered its Fair Value estimate, placing it on the list of Most Overvalued companies according to InvestingPro.

Earnings Expectations#

The firm anticipates that PPL will report adjusted earnings per share of $0.60 for the first quarter of 2026, which aligns with the earnings from the first quarter of 2025 when normalized. A significant factor contributing to this year-over-year increase is the Kentucky base rate order that took effect on January 1, adding approximately $233 million in revenue for the company's subsidiaries, LG&E and KU. However, this revenue boost is somewhat offset by increased costs related to depreciation, interest expenses, and ongoing equity issuance.

Regulatory Developments#

PPL Corp is also navigating various regulatory changes. The Pennsylvania settlement is expected to take effect on July 1, while Rhode Island's will start on September 1. These adjustments are crucial as they will influence the company’s financial performance in the latter half of the year. Additionally, the Federal Energy Regulatory Commission (FERC) has introduced a new method for calculating the return on equity for New England transmission owners, impacting PPL’s subsidiary, Rhode Island Energy.

Analyst Updates#

In recent analyst updates, Jefferies raised its price target for PPL shares to $48, citing confidence in the Pennsylvania rate case settlement and potential joint ventures. Wolfe Research increased its target to $44, while BTIG set its target at $45, highlighting PPL's progress in regulatory matters. Conversely, UBS maintained a Neutral rating, noting recommendations for a lower rate of return from the Rhode Island Division of Public Utility Staff. These developments indicate ongoing adjustments in PPL Corporation's regulatory and financial landscape.