Avista Corporation

AI-generated fair value estimate for this company.

Method: Gordon Growth (dividend discount) model for a regulated electric/gas utility: D0 = $1.97 (Avista's 2026 annualized dividend per company guidance), long-term dividend/earnings growth g = 3% (Avista's own guided long-term dividend growth rate, consistent with its 4-6% long-term utility EPS growth target), and a cost of equity r = 8.7% (approximates a regulated utility's market-required return, close to Avista's own targeted regulatory ROE of 9.0%); Fair Value = D0*(1+g)/(r-g) = 1.97*1.03/(0.087-0.03) = 35.60.

Reasoning: Avista is a rate-regulated electric/gas utility (NYSE: AVA) with a stable, management-guided dividend and slow, predictable earnings growth tied to rate base expansion, making a dividend discount model far more appropriate than a standard FCF/DCF approach used for unregulated growth companies; using the company's own guided dividend growth and a discount rate anchored to its allowed/target ROE keeps the inputs grounded in real, current company guidance rather than generic assumptions.