Avista upped at Mizuho as inverse condemnation unlikely to prevail in its area
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Avista (NYSE:AVA) +1.1% on Friday while much of the stock market plunges, as Mizuho upgraded shares to Buy from Neutral with a $44 price target, saying the company should benefit from a higher bar or tougher standard for inverse condemnation.
Under inverse condemnation in California, electric utilities are liable for damages caused by wildfires that are sparked by the utility's equipment, but Mizuho analyst Paul Fremont notes the bar is higher in Washington, Oregon and Colorado.
Mizuho believes "precedent case law in those states make it exponentially more difficult to find a utility liable for wildfires under the doctrine of inverse condemnation than under the negligible standard.
Mizuho also mentioned Idacorp (IDA), Xcel Energy (XEL), Black Hills (BKH) and Portland General Electric (POR) as other publicly traded utilities that should benefit from the higher standard for inverse condemnation.
Avista (AVA) recently reported Q2 adjusted earnings of $0.16/share on revenues of $368M.