Lower demand a risk for Ameren

Article Excerpt

AMEREN CORP. $69 is still a hold. The company (New York symbol AEE; Income Portfolio, Utilities sector; Shares outstanding: 246.9 million; Market cap: $17.0 billion; Price-to-sales ratio: 3.1; Dividend yield: 2.8%; TSINetwork Rating: Average; www.ameren.com) continues to expand its renewable energy operations. It’s now spending $1.2 billion on wind farms in Missouri as part of its plan to spend $16 billion between 2020 and 2024 on new projects and upgrades to its operations. By 2024, coal-fired plants will account for just 8% of its rate base. Regulators use rate base—the value of Ameren’s property—to calculate its approved rate of return and the power rates for its customers However, COVID-19 lockdowns will continue to hurt its overall power sales in 2020 and probably the first half of 2021. Ameren is a hold. hold…