PG&E ( PCG ) upgraded to Buy, $23 target vs. $18.05, 13.13% YTD, 43% P/E discount. Algonquin (AQN) was upgraded to Outperform, $7.25 target vs $6.09. Avista ( AVA ) started at equal weight, $40 target vs. $38.92.
Wall Street upgraded PG&E to regulated business strength despite progress on California wildfire legislation and guidance cuts to Algonquin, while declining Treasury yields boosted sector-wide utility valuations.
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Wall Street is taking a constructive look at the utility sector, and three names are giving the clearest signals right now. UBS upgraded PG&E to Buy, Raymond James upgraded Algonquin Power to Outperform, and Barclays initiated Avista with a Neutral stance, each call reflecting a different thesis on risk, recovery and valuation.
PG&E Corporation (NYSE:PCG) received a UBS upgrade to buy from neutral, raising its price target to $23 from $20. Basic Thesis: California’s wildfire policy should be improved and affordability reversed, with Phase Two legislation likely to reduce PG&E’s utility liability before the July 2 recess. UBS expects the stock’s 43% price-to-earnings discount to narrow “significantly” as risk continues to decline.
The data supports the forward-looking case. PG&E’s data center pipeline stands at 3.6 GW in final engineering, up from 1.6 GW in Q3 2025, representing a key catalyst for load growth. Management guided for 2026 non-GAAP core EPS of $1.64 to $1.66, with no new common equity required for the $73 billion five-year capital plan. The stock trades at $18.05, still about 22% short of UBS’s target, and is up 13.13% year to date. The consensus analyst target sits at $22.20, with 13 analysts rating the stock a buy or strong buy compared to just 4 holds and zero sells — a strongly bullish alignment. A forward P/E of 11x against a target of 9%+ annual EPS growth through 2030 is the gap that UBS believes the market will eventually close.
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Algonquin Power and Utilities (NYSE:AQN) was upgraded by Raymond James from market perform to outperform, with the price target raised to $7.25 from $6.50. Firm’s View: Share pullback has been substantial following revised 2027 EPS guidance, and with continued constructive results in cost discipline and key rate cases, Algonquin is on track to strengthen its core regulated utility business.