Northwest Natural (NWN) Upgraded to Buy: What Does It Mean for the Stock?

Core Viewpoint - Northwest Natural (NWN) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with near-term stock price movements [4][6]. - Institutional investors often rely on earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [4]. Company Performance and Outlook - The upgrade for Northwest Natural indicates an improvement in the company's underlying business, which is expected to drive the stock price higher as investors respond positively to this trend [5][10]. - For the fiscal year ending December 2025, Northwest Natural is projected to earn $2.92 per share, with a 2.8% increase in the Zacks Consensus Estimate over the past three months [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7]. - The upgrade to Zacks Rank 2 places Northwest Natural in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10].