The natural gas company reported on May 2 second-quarter earnings of $109.1 million, or $1.20 a share, down from year-earlier earnings of $132.2 million, or $1.45 a share."We upgrade ATO to Buy (from Neutral) and boost our PO to $37 (from $34)," Bank of America Merrill Lynch analysts wrote in a May 17 report. "We see ATO's plan to grow its rate base at a peer-leading CAGR of 8-8.5% over the next few years (versus a peer average growth rate of 5-6%) as auguring for a rerating of ATO among its gas utility peers. Over the past few years, ATO has traded at a significant discount to its peers driven by ATO's acquisitive history and underearning at its largest Distribution segment. However, given forecasted rate base growth, a strong balance sheet, a more progressive regulatory regime, and management's posture of remaining conservative with prospective acquisitions, we see ATO's current discount valuation to peers as unjustified." Forward Annual Dividend Yield: 4.2%
Equifax The financial and marketing information solutions company reported on April 25 first-quarter earnings of $71.5 million, or 58 cents a share, up from year-earlier earnings of $57.3 million, or 46 cents a share. "Reflecting a better 1H12 outlook, EFX updated its 2012 guidance to a range well ahead of LT growth targets," Credit Suisse analysts wrote in an April 26 report. "The company now expects 12 revenue growth of 10-12% (7-10% long-term) with implied adj. EPS growth of 12-15% (10-13%). The better than anticipated 1H stems from a stronger than expected mortgage contribution (added ~500bp to YoY growth in 1Q) and OCIS revenue growth of 24% (well ahead of 16% online volume growth reflecting positive pricing and favorable mix). While 2Q revenue growth should be comparable to 1Q (12-14%), we expect a deceleration over 2H12 reflecting tougher comps, lapping of pricing initiatives and acquisitions and a lower mortgage contribution." Forward Annual Dividend Yield: 1.6%
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