September 19, 2017

D – Market expectations are for slight Uniform ROA expansion, but management’s concerns about their operating earnings growth and guidance imply this may be unwarranted


  • Dominion Energy, Inc. (D:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Assets, with a 1.6x Uniform P/B, implying fairly bullish expectations for the firm. However, given management’s concerns about their operating earnings growth and guidance, this may be unwarranted
  • Specifically, management appears concerned about the sustainability of operating EPS growth, and may be downplaying concerns about their 2017 earnings guidance range. Should the firm fail to drive Uniform Turns back to historical averages, as management sentiment suggests, multiple compression and equity downside would be warranted

click here to read more (registration required)