PPL Trades Above 50 & 200-Day SMAs: Time to Buy or Hold the Stock?

Core Viewpoint - PPL Corporation is positioned as a U.S.-focused energy company following the divestiture of its international operations, with a bullish trend indicated by its trading above key moving averages [1][3] Group 1: Financial Performance and Stock Trends - PPL's stock closed at $34.98 on February 25, with a 33.4% increase over the past year, outperforming the industry average of 24.5% and the S&P 500's growth of 18.4% [3] - The company has a forward 12-month P/E ratio that indicates it is trading at a premium compared to its industry [14] - PPL's trailing 12-month return on equity is 8.88%, which is lower than the industry average of 10.87% [17] Group 2: Capital Investment and Infrastructure - PPL has a long-term capital expenditure plan of$ 20 billion for the 2025-2028 period aimed at strengthening its infrastructure for energy generation, transmission, and distribution [5] - Over 60% of PPL's capital investment plan is subject to "contemporaneous recovery," allowing for quicker recovery of capital expenditures and reducing regulatory lag on earnings [6] - The company has achieved cumulative annual O&M savings of $130 million from a 2021 baseline and aims to reduce expenses by at least$ 175 million by 2026 [7] Group 3: Demand Drivers and Market Opportunities - The service regions in Pennsylvania and Kentucky are experiencing increased demand from data centers, with new requests for 48 gigawatts (GW) and 6 GW respectively over the 2026-2034 period [8] - Electric sales volume in Pennsylvania and Kentucky saw year-over-year increases of 1.1% and 1.2% in 2024, respectively, driven by new data center connections [9] Group 4: Strategic Initiatives - PPL is implementing a "Utility of the Future" strategy, which includes IT transformation and enhanced engineering standards to improve service resilience against weather and storm risks [10] - The company plans to increase dividends annually by 6-8% through at least 2028, with a recent quarterly dividend rate raised by 6% to 27.25 cents, resulting in an annual dividend of $1.09 per share [12]