Scotiabank on Dec. 20 upgraded both American Electric Power Co. Inc. and Alliant Energy Corp. to "sector outperform" from "sector perform."
For AEP, the research firm expects the company to deliver above-average earnings growth in the next few years.
"Though the regulatory calendar will remain busy in 2020, with some noteworthy risks, we're drawn to the stock's valuation, trading at parity with peers, as well as its large market cap/trading liquidity, mostly clean outlook, massive capex backlog, and track record of beating expectations in recent years," Scotiabank analyst Andrew Weisel wrote in a report.
For Alliant, Scotiabank is optimistic that the company will move forward with its growth plan, and expects limited operational or financial risks in the future.
"We see Alliant as a high-quality company and stock," Weisel said in a separate report. "Though not cheap, trading at a 5% P/E premium vs. peers, we like the risk-adjusted outlook and argue for an additional premium expansion of up to 10%."