Stock Analysis | Eversource Outlook - Technical Weakness Weighs, But Fundamentals Hold Steady

Eversource Outlook - Technical Weakness Weighs, But Fundamentals Hold Steady

1. Market Snapshot

Headline Takeaway: Eversource (ES) faces a bearish technical outlook with a weak internal diagnostic score of 3.87, while fundamentals remain stable with a score of 4.97.

2. News Highlights

• Michigan Utility Investment Deal: Michigan is teaming up with its two largest utilities to allocate $3.5 billion toward local suppliers, which could benefit Eversource given its presence in energy infrastructure. However, the stock has seen a slight decline in the short term.
• Electric Ferry Projects: While not directly impacting Eversource, the global push for electric ferry systems and clean energy storage solutions highlights a broader industry trend that could eventually benefit the utility sector.
• Visa Policy Changes in the U.S.: The new visa restrictions on Chinese students might affect global business and investment dynamics, though it’s unclear how this will translate to Eversource’s domestic operations.

3. Analyst Views & Fundamentals

Eversource has one active analyst, Julien Dumoulin-Smith from B of A Securities, who recently gave a Neutral rating. The simple average rating is 3.00, while the historical performance-weighted rating stands at 2.08. These scores indicate a somewhat negative bias.

There is some dispersion in the market view, with only one analyst active in the last 20 days, but the ratings remain consistent. The current price trend is down (-0.73%), aligning with the bearish sentiment reflected in the weighted average rating.

Key fundamental values:

• Gross Margin (GPM): 71.15% — Internal diagnostic score: 3.7
• Gross Margin Return on Assets (GMAR): 71.15% — Internal diagnostic score: 3.7
• Basic Earnings Per Share YoY Growth: 81.97% — Internal diagnostic score: 4.9
• Long-term Debt to Working Capital Ratio: 7.02% — Internal diagnostic score: 5.0
• Diluted Earnings Per Share YoY Growth: 82.30% — Internal diagnostic score: 4.8
• Net Profit YoY Growth: 540.45% — Internal diagnostic score: 4.9

These fundamentals remain strong, with earnings and profit growth outpacing peers. However, the mixed signals from the technical side suggest caution ahead of any directional move.

4. Money-Flow Trends

Big money is moving out of Eversource across all categories. The fund-flow score is 7.72, classified as “good”, but the overall trend is negative for both small and large institutional flows. Specifically:

• Small retail inflow ratio: 49.53%
• Large institutional inflow ratio: 47.44%

While the high inflow ratios suggest some retail interest, the negative trend among major investors signals caution. The block trade inflow ratio is 47.30%, indicating large players are also stepping back.

5. Key Technical Signals

The technical outlook for Eversource is weak, with 3 bearish indicators and only 1 bullish one. The overall trend is bearish, and the internal diagnostic score for technicals is 3.87.

Key indicators and scores (internal diagnostic scores 0-10):

• Bullish Engulfing: 3.8 — A bullish reversal pattern, but recent performance is weak with a -7.00% average return.
• WR Oversold: 3.7 — Indicates potential buying interest, but signals have been limited in the last five days.
• Marubozu White: 1.0 — A bearish signal with a historically poor win rate of just 16.67%.
• Hanging Man: 7.0 — A strong bearish signal, with a high win rate of 66.67%.

Recent chart patterns (Last 5 days):

• 2025-08-12: Hanging Man — A potential top reversal.
• 2025-08-26: Bullish Engulfing — A bullish reversal pattern.
• 2025-08-25: Long Lower Shadow — Mixed signal; could indicate indecision.
• 2025-08-19: Marubozu White — A bearish signal with high volume.
• 2025-08-18: WR Oversold — Potential for a bounce.

The mixed signals point to an uncertain trend, and the bearish indicators dominate, suggesting investors are wary of near-term upside.

6. Conclusion

Eversource’s fundamentals remain solid, with strong earnings and profit growth, and a relatively good fund-flow score. However, the internal diagnostic score for technicals is weak at 3.87, and the technical indicators are skewed toward bearish signals.

Actionable takeaway: Consider waiting for a pull-back or clearer technical confirmation before committing capital. With the fundamentals intact but the technicals under pressure, now may not be the best time to initiate a long position.