New Jersey Resources (NYSE:NJR) is a company that continues to thrive due to its ongoing infrastructure enhancements, enabling it to efficiently cater to its growing customer base. With promising earnings growth prospects and a solid return on equity (ROE), NJR emerges as a compelling investment opportunity within the utility sector.
Let’s delve into the key factors that position this Zacks Rank #2 (Buy) entity as a favorable investment choice in the current landscape.
Growth Projections & Surprise History
Over the past 90 days, the Zacks Consensus Estimate for New Jersey Resources’ fiscal 2024 earnings per share has seen a 1.7% upward revision to $2.94. Moreover, the company has a track record of delivering an average earnings surprise of 107.4% over the last four quarters.
Return on Equity
One crucial metric, Return on Equity (ROE), showcases how effectively a firm utilizes its capital to generate returns. Currently, NJR boasts an ROE of 12.16%, surpassing the industry average of 9.7%. This indicates that the company has been deploying its funds more efficiently compared to its counterparts in the utility gas distribution sector.
Dividend Growth
New Jersey Resources has been dedicated to enhancing shareholder value through dividend payouts. Presently, the company offers a quarterly dividend of 42 cents per share, translating to an annualized dividend of $1.68 per share, marking a 7.7% increase from the previous figure of $1.56. With a current dividend yield of 3.99%, NJR outperforms the Zacks S&P 500 composite’s yield of 1.29%.
Systematic Investments & Customer Growth
As part of its strategic approach, New Jersey Resources consistently invests in upgrading and maintaining its infrastructure to ensure uninterrupted services for its clientele. The company anticipates capital expenditures to fall within the range of $619-$754 million, emphasizing its commitment to providing reliable services to customers round the clock.
