Stock Analysis | Eversource Outlook - Technical Weakness Looms Amid Mixed Fundamental Signals

Market Snapshot

Headline Takeaway: Eversource (ES) faces a mixed outlook with technical weakness and a neutral market sentiment from analysts.

While fundamentals show some strength in earnings growth, technical signals suggest a weak trend with a “suggested to avoid” internal diagnostic score of 3.72. On the other hand, analyst consensus is neutral, with a simple average rating of 3.00 and a performance-weighted score of 3.30.

News Highlights

Recent developments affecting the utility sector include:

• Michigan Utility Partnerships: Michigan has partnered with its two largest for-profit utilities to funnel $3.5 billion in annual spending to in-state businesses, especially those in clean energy. This could indirectly benefit Eversource, which operates in the energy sector.
• Electric Vehicle Incentives: Governments globally are pushing for electric vehicle adoption, including a proposed levy on gasoline-powered cars in some regions. This could increase long-term demand for utility services, including Eversource, as EV infrastructure grows.
• Analyst Neutral Outlook: B of A Securities' analyst Julien Dumoulin-Smith has maintained a “Neutral” rating on Eversource, citing stable conditions in the utility sector and no immediate catalysts for price swings.

Analyst Views & Fundamentals

The latest analyst rating from B of A Securities is Neutral, with a historical win rate of 100% and an average return of 0.24% over the past 20 days. The simple average rating for Eversource is 3.00, and the performance-weighted average rating is 3.30, indicating a relatively consistent but non-committal outlook from analysts.

The current price trend shows a rise of 0.58%, which aligns with the neutral market expectations. However, the internal diagnostic fundamental score is 2.86, reflecting mixed fundamentals with both positive and negative factors in play.

Key fundamental factors include:

• Basic earnings per share (YoY growth rate %): 0.82% (Score: 2.86)
• Quick ratio: 0.63 (Score: 2.00)
• Non-current assets / Total assets (%): 91.95% (Score: 2.00)
• Long-term debt to working capital ratio (%): 7.18% (Score: 1.00)
• Cost of sales ratio (%): 31.04% (Score: 2.00)

While earnings growth is modest and positive, liquidity and leverage measures are weaker, indicating a need for caution.

Money-Flow Trends

Big money is currently moving out of Eversource, with an overall inflow ratio of 48.35% and a negative overall trend. Specifically, both Large and Extra-large funds are showing outflows, with inflow ratios of 46.99% and 49.07%, respectively.

On the retail side, Small investors also show a negative trend (inflow ratio: 49.75%). The fund-flow score is 7.69 (internal diagnostic score, 0-10), indicating strong outflows despite the high score, which suggests caution for near-term momentum.

Key Technical Signals

Technically, Eversource is facing significant bearish pressure. The internal diagnostic technical score is 3.72, indicating a weak trend, with a recommendation to “avoid” the stock. The chart has shown a mix of bearish and neutral patterns:

• Marubozu Black (internal score: 1.00): A bearish candlestick pattern observed on 2025-08-06.
• WR Oversold (score: 3.89): Seen on 2025-08-08 and 2025-08-18, suggesting a possible bottoming process, but not a strong reversal.
• Marubozu White (score: 1.00): Observed on 2025-08-19; another bearish signal.
• Hanging Man (score: 7.00): A neutral to bullish signal on 2025-08-12, but overwhelmed by the bearish trend.

Key Insight: The recent 5-day trend shows 3 bearish vs 1 bullish signal, with the overall momentum clearly favoring the downside. The market appears volatile but directionally unclear, making it a high-risk trade for now.

Conclusion

Given the weak technical indicators and mixed fundamental signals, Eversource is not a compelling buy at this time. While analyst ratings remain neutral and some fundamentals (like earnings) show slight improvement, the bearish technical setup suggests caution.

Consider waiting for a clearer breakout or a pullback to a key support level before considering entry. Investors should monitor earnings reports and any regulatory developments in the utility sector, which could provide new catalysts for the stock.