UBS has shifted its view on Evergy, Inc., lowering the stock rating from Buy to Neutral while simultaneously lifting its one-year price objective to $88.00 from $86.00. The change comes as Evergy shares trade at $80.69, close to a 52-week high of $81.40, after delivering a 25.41% total return over the past year.
In explaining the move, UBS pointed to what it called "strong regulatory performance and share price strength over the past year," indicating that those developments reduce the scope for additional multiple expansion. The firm concluded that the current trading multiple more appropriately captures projected earnings growth, execution risk and an improved regulatory backdrop.
UBS noted Evergy's projected earnings trajectory of roughly 7-8% EPS growth and maintained its 2028 EPS estimate at $4.90. That 2028 figure represents a 7.3% compound annual growth rate from Evergy's 2025 guidance midpoint of $3.97, according to the firm. Valuation metrics highlighted in the UBS assessment include a P/E ratio of 22.22 and a dividend yield of 3.45%.
Independent data cited in the UBS commentary shows Evergy has paid dividends for 34 consecutive years, a track record that underscores consistent shareholder distributions. InvestingPro's fair-value assessment was referenced as indicating the stock appears fairly valued at current levels.
UBS described Evergy's risk/reward profile as "balanced" as the utility shifts toward a growth strategy targeting large load customers. UBS emphasized that those initiatives "will take years to develop," signaling a lengthy execution horizon for the company’s strategic pivot.
On the corporate financing front, Evergy has entered into a $500 million unsecured term loan credit agreement with Wells Fargo Bank, National Association, and other lenders. That new facility is scheduled to expire on February 10, 2027. Evergy said it intends to deploy the proceeds for working capital, capital expenditures, permitted acquisitions and general corporate purposes. The company will also repay all outstanding borrowings under a prior $55 million unsecured term loan agreement with Bank of America, N.A.
Separately, Mizuho has moved its rating on Evergy from Outperform to Neutral, citing valuation concerns. Mizuho said the stock price already reflects the improved regulatory environment in Evergy's principal service territories of Kansas and Missouri, and reduced its price target from $86.00 to $76.00.
Taken together, the analyst activity and the recent financing arrangement frame a period in which market valuation, regulatory outcomes and the pace of Evergy's strategic execution will be central to investor assessments. UBS's shift to Neutral and Mizuho's similar repositioning underscore a narrower potential upside on current multiples while drawing attention to the multi-year nature of the company's growth ambitions.