Avista Pauses Data-Center Deal Amid Wildfire Fears

Avista Corporation (AVA) operates as an integrated energy provider serving residential, commercial, and industrial clients across the Pacific Northwest. The company maintains a robust transmission and distribution network, delivering electric and natural gas services to approximately 400,000 electric customers and 324,000 natural gas customers in Washington, Oregon, and Idaho. Beyond its core regulated utility operations, Avista invests in owned generation assets, including hydroelectric, natural gas-fired, coal, and wind facilities, to ensure system reliability and long-term supply planning. Founded in 1889, the enterprise has evolved into a significant regional utility with a market capitalization of $3.13 billion.

Recent Financial Performance and Earnings

In the second quarter of 2026, Avista reported earnings per share (EPS) of $0.29, surpassing analyst estimates of $0.24 by 20.83%. However, revenue came in at $426.93 million, missing forecasts of $429.98 million by 0.71%. This financial result coincided with a 3.07% decline in share price, driven largely by concerns regarding wildfire impacts. The Spokane wildfires resulted in service disruptions for 7,300 electric and 5,300 gas customers. Management indicated that the subsequent earnings call focused primarily on damage assessment and restoration efforts rather than routine financial metrics.

The company’s non-regulated segment contributed positively to results through gains related to an EIP fund IPO. Management noted that another gain is expected in the third quarter, though this is subject to reversal based on public investment volatility. Looking forward, analysts project that Avista will post 2.57 EPS for the current year.

Strategic Adjustments and Regulatory Environment

Avista has adjusted its capital planning by removing a 500 MW data-center project from its current upside plan. The company paused a memorandum of understanding (MOU) related to this project until clear net benefits and reliability assurances for existing customers can be established. This decision reflects a cautious approach to balancing new infrastructure investments with service reliability for the customer base.

Simultaneously, the Washington four-year rate case remains on schedule, with hearings set for September 17-18 and a decision expected by mid-December. The Chief Financial Officer warned that achieving a settlement will be "quite difficult," indicating potential friction in regulatory negotiations.

Institutional Activity and Insider Transactions

Institutional investors have been active in Avista’s stock. Allianz Asset Management GmbH acquired a new stake in the second quarter, purchasing 44,339 shares valued at approximately $1.814 million. Other significant movements include BlackRock Inc., which purchased a new position valued at roughly $605.4 million, and State Street Corp, which increased its stake by 0.9% in the fourth quarter, holding over 5.3 million shares. California State Teachers Retirement System significantly expanded its position by 3,930.1% in the second quarter. Hedge funds and other institutional investors collectively own 85.24% of the company’s stock.

Conversely, insider activity showed a reduction. Vice President Joshua D. Diluciano sold 4,675 shares on September 2, reducing his position by 35.94%. The sale occurred at an average price of $37.24. Company insiders own 0.78% of the stock.

Analyst Outlook and Dividend Policy

Wall Street analysts maintain a cautious stance. Barclays lowered its target price from $40 to $37, assigning an "equal weight" rating. Zacks Research upgraded the stock from "strong sell" to "hold," while Weiss Ratings adjusted its rating from "buy (b)" to "buy (b-)". The consensus rating among analysts is "Hold," with an average price target of $39.25.

Avista recently announced a quarterly dividend of $0.4925 per share, payable on September 14. With an ex-dividend date of August 18, this represents an annualized yield of 5.3% and a payout ratio of 71.12%. The stock currently trades with a price-to-earnings ratio of 13.50 and a beta of 0.25, reflecting its status as a stable, albeit regulated, utility provider.