PPL - Embedded Expectations Analysis - 2020 02 24
ï€ PPL Corporation (PPL:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 21.7x Uniform P/E. At these levels, the market is pricing in somewhat bearish expectations for the firm, but management is confident about their electricity system investments, capital investment opportunities in the UK, and their business strategyï€ Specifically, management is confident that their investment in reliable electricity systems in Kentucky enables them to pursue renewable generation efforts and that they welcome the opportunity to support UK decarbonization and electrification efforts. Moreover, they are confident that there could be significant capital investment opportunities in the UK and that their overall business strategy has not changed. In addition, they are confident about the potential for future Advanced Metering Infrastructure deployment in Kentucky
PPL is a utility holding company. Through its regulated utility subsidiaries, the company delivers electricity to customers in United Kingdom, Pennsylvania, Kentucky, and Virginia; delivers natural gas to customers in Kentucky; and generates electricity from power plants in Kentucky. The company's segments are: United Kingdom Regulated, which has regulated electricity distribution operations in United Kingdom; Kentucky Regulated, which is engaged in the regulated generation, transmission, distribution and sale of electricity in Kentucky and Virginia, and the distribution and sale of natural gas in Kentucky; and Pennsylvania Regulated, which delivers electricity in eastern and central Pennsylvania.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
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- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
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