Guggenheim has lowered its recommendation on Itron from Buy to Neutral and eliminated its former $155 price target after revisiting the company’s short-term growth assumptions. The downgrade coincides with Itron shares trading at $95.74, and analyst price targets now span $118 to $150, per InvestingPro data.
In updating its model, Guggenheim cut Itron’s revenue forecasts for 2026 and 2027 to $2.32 billion and $2.42 billion, respectively. The firm made deeper reductions to profitability measures, trimming 2026 EBITDA to $337 million and 2027 EBITDA to $361 million.
These revisions come against recent share-price weakness. The stock has declined nearly 8% over the past week and about 25.5% over the prior six months, though it remains classified as undervalued under InvestingPro’s Fair Value assessment.
Drivers cited by Guggenheim
Guggenheim explained that its altered outlook reflects an expectation of lower backlog coverage entering 2026 compared with the prior year. The analyst also anticipates that Itron’s management will take a more cautious posture when providing forecasts, particularly around book-and-ship revenue timing during the year.
The research team’s model continues to include assumed revenue contributions from Itron’s recent acquisitions of Orbital and Locusview. At the same time, Guggenheim noted that both acquired businesses are expected to add substantial operating expenses, which is a key factor behind the reduced EBITDA projections.
Guggenheim’s updated projections now sit below Bloomberg consensus figures for both 2026 and 2027. For 2026, the firm’s outlook implies essentially flat revenue compared with the prior year and an approximate 7% decline in EBITDA.
Business developments and partnerships
While the analyst adjustments weigh on the near-term financial view, Itron has continued to announce commercial initiatives intended to broaden its utility offerings. The company expanded its cooperation with Microsoft by introducing the Intelligent Edge Operating System Connector for Microsoft 365 Copilot, which is designed to let utility personnel query data using natural language. That integration is framed as a way to improve oversight of consumption patterns and operational metrics.
Itron is also collaborating with Pacific Gas and Electric Company to bolster grid safety and support electric vehicle adoption using its Grid Edge Intelligence solutions. In the water sector, Tucson Water in Arizona has begun deploying Itron’s Advanced Metering Infrastructure Essentials with a plan to install 250,000 smart water communication modules by 2029 to enhance conservation and efficiency. Similarly, Northumbrian Water Limited intends to deploy 330,000 water meters in northeast England by 2029 as part of its system modernization.
These initiatives illustrate ongoing efforts by Itron to provide hardware and software solutions for utility clients, even as analysts reassess near-term financial outcomes.
Market and analyst context
Guggenheim’s downgrade and lower forecasts underscore a more cautious analyst stance toward Itron’s growth cadence and margin profile through 2027. The firm attributes part of the margin pressure to the operating-cost burden from the Orbital and Locusview acquisitions while flagging reduced backlog coverage and management conservatism on book-and-ship timing as reasons for trimming revenue expectations.
For investors and market participants, the juxtaposition of ongoing commercial activity and a dimmer near-term financial outlook highlights the tension between execution of strategic initiatives and the immediate impact on earnings and cash flow metrics.