BMO cuts Evergy stock price target on valuation despite earnings beat

BMO Capital downgraded Evergy Inc. (EVRG) stock price target to $85 from $89 while keeping an Outperform rating. The utility stock is currently priced at $81.17, reflecting a market capitalization of $18.7 billion. The firm revised its third-quarter 2026 earnings estimate to $2.38 per share from $2.22, and expanded its full-year 2026 forecast to $4.34 from $4.24.

These adjustments align with the consensus EPS forecast of $4.41 for the same period. The positive changes are largely due to Evergy's favorable weather performance in comparison to the first half of the year. BMO anticipates the company to further increase its guidance upon releasing third-quarter results on November 5, potentially raising the high-end of its forecast range above $4.34 based on forthcoming weather-related contingencies.

The analyst highlighted a particularly robust September weather period for Evergy, which contributed positively to its performance. BMO remains confident in the company's long-term strategy and expects management to accelerate operational and maintenance expenses, enhancing confidence in Evergy's 2027 outlook and long-term plan.

Despite the earnings beat, InvestingPro analysis indicates the stock is currently overvalued relative to its Fair Value estimate. Investors can access a comprehensive Pro Research Report on Evergy through InvestingPro, among 1,400+ reports available, which simplifies intricate Wall Street data into clear actionable insights.