Alliant Energy Benefits From Expanding Customer Base and Investment

Alliant Energy LNT benefits from customer growth, a rise in data center demand and strong supply-chain management, supporting its steady earnings growth. Its strategic capital investment improves operational reliability, expands renewable assets and supports long-term growth.

This Zacks Rank #3 (Hold) company faces risks from a rise in transmission costs and regulatory challenges, which may negatively affect its profitability.

LNT’s Tailwinds

Alliant Energy benefits from an expanding customer base, driven by economic development in its service territory. This creates fresh demand for utility services, improving overall operational and financial performance. Rising demand from LNT’s diverse customer mix ensures long-term earnings stability.

LNT is aided by increasing electricity load growth from data centers. The company signed 3 gigawatts data center contract and long-term service agreements with high-quality customers, boosting its financial performance.

Alliant Energy has a strong supply chain with no disruption, which helps in effective cost control and supports consistent revenue growth. LNT targets 5-7% annual earnings growth and projects earnings per share to exceed 7% annually during the 2027-2029 period.

Alliant Energy's strategic capital investment in renewable expansion and infrastructure development strengthens service reliability, supports cleaner energy generation and drives long-term growth. The company plans $13.4 billion in capital investment during 2026-2029, supporting 12% rate-based growth. Through systematic investment, the company aims to add 1,000 MW of Energy Storage and 1,300 MW of new renewables in the portfolio to meet the rising demand in its service territories.

LNT’s Headwinds

Alliant Energy’s unit, Interstate Power and Light Company and Wisconsin Power and Light Company, depend on interstate electric transmission systems that are not owned or controlled by it and rates charged are regulated by FERC. Any rise in transmission costs or underperformance by third parties may adversely affect the company’s operational performance and pressure margin.

LNT operations are governed by extensive environmental regulations at both the federal and state levels. Any non-compliance with laws may adversely impact its operation and affect financial performance.

Price Performance of LNT

In the past three months, Alliant Energy's shares have rallied 14.0% compared with the industry’s 12.1% growth.

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Stocks to Consider

Some better-ranked stocks in the same industry are CMS Energy CMS, DTE Energy DTE and Duke Energy DUK. All stocks currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CMS, DTE and DUK have dividend yields of 2.89%, 3.13% and 3.24%, respectively, which are better than the Zacks S&P 500 composite’s yield of 1.41%.

The Zacks Consensus Estimate for CMS Energy, DTE Energy and Duke Energy’s 2026 EPS are pegged at $3.86, $7.72 and $6.71, indicating year-over-year growth of 6.93%, 4.89% and 6.34%, respectively.

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Duke Energy Corporation (DUK): Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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