UBS Makes Modest Price Target Increase on Pinnacle West (PNW)

Core Insights - Pinnacle West Capital Corporation (NYSE: PNW) is recognized as one of the Best Stocks for Dividend Achievers [1] Financial Performance - Pinnacle West reported earnings of $3.39 per share for Q3 2025, driven by increased transmission revenue and solid sales growth across customer segments, although offset by lower weather-related sales, higher interest expenses, and a larger share count [4] - The company experienced a total sales growth of 5.4% for the quarter, with commercial and industrial sales rising by 6.6% and residential sales increasing by 4.3%. Year-to-date residential sales are up 2% [5] - Pinnacle West raised its full-year earnings outlook for 2025 to a range of $4.90 to $5.10 per share, an increase from the previous range of $4.40 to $4.60, citing strong sales and higher transmission revenue as key factors [5] Strategic Developments - Management announced plans for a new generation site near Gila Bend, which could add up to 2,000 megawatts of natural gas capacity. Progress on long-term transmission upgrades and baseload investments is also ongoing, with the Desert Southwest expansion project remaining on track [3] Market Position - Pinnacle West operates primarily through Arizona Public Service, providing regulated retail and wholesale electricity across Arizona [6] - UBS has slightly increased its price target for Pinnacle West to $95 from $94 while maintaining a Neutral rating on the stock [2]