Alliant Energy's Constructive Regulatory Environments Support Growth

Strategist

Andrew Bischof

Our forecast for Alliant Energy to invest $10.5 billion from 2023-27 supports our estimate for the company to achieve the high end of management's 5%-7% growth target. Management estimates continued capital investment opportunities in the second half of the decade, supporting growth beyond our forecast.

Interstate Power and Light, or IP&L, continues to build out renewable energy in Iowa. In addition to its significant wind generation in Iowa, for which the company earns a premium return on equity, the subsidiary now aims to install significant solar generation as well as distributed energy resources. We continue to believe Iowa offers ample renewable energy investment opportunities—both wind and solar—to support the utility's Clean Energy Blueprint, which plans to eliminate all coal generation by 2040 and achieve net-zero carbon dioxide emissions by 2050.

At Wisconsin Power and Light, renewable energy is also a focus as the company begins replacing retiring coal generation. WPL plans sizable solar energy investments paired with battery storage. WPL has similar clean energy goals IP&L, including a 50% reduction in carbon emissions by 2030, eliminating coal from its generation fleet by 2040, and reaching net-zero carbon emissions from its generation fleet by 2050.

Across both subsidiaries, renewable energy investments account for over 20% of rate base, growing to nearly 40% by 2026.

Alliant benefits from operating in what we consider two of the most constructive regulatory jurisdictions. To maintain earned returns near allowed returns during this period of high investment, management has worked to reduced regulatory lag, received above-average allowed returns across its subsidiaries, and aims continue to reduce operating costs for the near term. 

American Transmission Co., which we consider a wide-moat business, is tucked away from consolidated results (16% equity interest). Transmission offers higher returns relative to other rate-regulated investments.

Business Strategy & Outlook

Service territory monopolies and efficient-scale advantages are the primary sources of economic moat for regulated utilities such as Alliant. State and federal regulators typically grant regulated utilities exclusive rights to charge customers rates that allow the utilities to earn a fair return on and return of the capital they invest to build, operate, and maintain their distribution networks. In exchange for regulated utilities’ service territory monopolies, state and federal regulators set returns at levels that aim to minimize customer costs while offering fair returns for capital providers. We believe Alliant has healthy relationships with the regulators in its two main states, Iowa and Wisconsin, as exemplified by mechanisms that allow the firm to more closely earn its allowed return on equity.

This implicit contract between regulators and capital providers should, on balance, allow Alliant to earn greater than its cost of capital, though observable returns might vary in the short run based on demand trends, investment cycles, operating costs, and access to financing. Intuitively, utilities should have an economic moat based on efficient scale, but in some cases regulation offsets this advantage, preventing excess returns on capital. The risk of adverse regulatory decisions prevents regulated utilities from earning wide economic moat ratings. However, the threat of material value destruction is low, and normalized returns exceed costs of capital in most cases, leaving us comfortable assigning narrow moat ratings to many regulated utilities.

Narrow

Economic Moat

Alliant Energy

Alliant Energy Corp. is a regulated investor-owned public utility holding company that engages in the provision of regulated electricity and natural gas service to natural gas customers in the Midwest through its two public utility subsidiaries. It operates through following segments: utility electric operations, utility gas operations, and utility other. The company was founded in 1981 and is headquartered in Madison, WI.

Earnings data Q2 2023

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Alliant Energy Corp. is a regulated investor-owned public utility holding company, which engages in the provision of regulated electricity and natural gas service to natural gas customers in the Midwest through its two public utility subsidiaries. It operates through following segments: Electric Utility, Gas Utility, Other Utility, and Non-Utility and Other. The company was founded in 1981 and is headquartered in Madison, WI.

Alliant Energy Corporation (NASDAQ:LNT ) Q1 2023 Results Conference Call May 5, 2023 10:00 AM ET Company Participants Susan Gille - Manager of IR John Larsen - Chairman and CEO Robert Durian - Executive VP and CFO Conference Call Participants Dariusz Lozny - Bank of America Operator Good morning, and welcome to Alliant Energy Conference Call for First Quarter 2023 Results. This call is being recorded for rebroadcast.

Alliant Energy Corporation (LNT) Q1 2023 Earnings Call Transcript

Alliant Energy's (LNT) first-quarter 2023 earnings and revenues lag estimates. Sales increase year over year.

Alliant Energy (LNT) Q1 Earnings Miss Estimates, Revenues Rise Y/Y

MADISON, Wis.--(BUSINESS WIRE)--Alliant Energy Corporation (NASDAQ: LNT) today announced U.S. generally accepted accounting principles (GAAP) consolidated unaudited earnings per share (EPS) for the three months ended March 31 as follows:   GAAP EPS   2023   2022 Utilities and Corporate Services $0.65   $0.73 American Transmission Company (ATC) Holdings 0.04   0.03 Non-utility and Parent (0.04)   0.01 Alliant Energy Consolidated $0.65   $0.77 “We had a solid start to the year and are well positi.

Alliant Energy Announces First Quarter 2023 Results

Alliant Energy's (LNT) first-quarter 2023 results are expected to benefit from capital investments and lower operation and maintenance expenses.

Alliant Energy (LNT) to Post Q1 Earnings: What's in Store?

MADISON, Wis.--(BUSINESS WIRE)--Alliant Energy Corporation (NASDAQ: LNT) has scheduled its first quarter 2023 earnings release for Thursday, May 4th, after market close. A conference call to review the first quarter results is scheduled for Friday, May 5th at 9 a.m. CT. Alliant Energy will webcast the event live at www.alliantenergy.com/investors. The call is open to the public and will be hosted by John Larsen, Board Chair and CEO; and Robert Durian, Executive Vice President and CFO.

Alliant Energy Corporation Announces First Quarter 2023 Earnings Release and Conference Call

MADISON, Wis.--(BUSINESS WIRE)--The Alliant Energy Corporation (NASDAQ: LNT) Board of Directors today declared a quarterly cash dividend of $0.4525 per share payable on May 15, 2023, to shareowners of record as of the close of business on April 28, 2023. Dividends on common stock have been paid for 310 consecutive quarters since 1946. Alliant Energy Corporation (NASDAQ: LNT) provides regulated energy service to 995,000 electric and 425,000 natural gas customers across Iowa and Wisconsin.

Alliant Energy Corporation declares quarterly common stock dividend

MADISON, Wis.--(BUSINESS WIRE)--Wisconsin Power and Light Company (“WPL”), a wholly owned subsidiary of Alliant Energy Corporation (NASDAQ: LNT), announced the pricing of its public offering of $300 million aggregate principal amount of 4.950% debentures. The debentures will be due on April 1, 2033. An amount equal to or in excess of the net proceeds from this offering will be allocated or disbursed for the development and acquisition of solar electric generating units.

Wisconsin Power and Light Company Prices Public Offering of Green Bonds

Alliant Energy operates in favorable regulatory jurisdictions and has a strong track record of growth. It has a solid outlook thanks to investments in renewable energy sources.

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MADISON, Wis.--(BUSINESS WIRE)--With a commitment to serving customers and building stronger communities, Alliant Energy and the company's charitable foundation, along with the company's employees and retirees, collectively contributed $12.1 million and volunteered over 70,000 hours in 2022.

Communities received $12.1M from Alliant Energy in 2022

MADISON, Wis.--(BUSINESS WIRE)--Alliant Energy Corporation (NASDAQ: LNT) announced the pricing of its offering of $500 million aggregate principal amount of its 3.875% convertible senior notes due 2026 in a private placement under the Securities Act of 1933, as amended (the “Securities Act”).

Alliant Energy Prices Offering of $500 Million of 3.875% Convertible Senior Notes due 2026

MADISON, Wis.--(BUSINESS WIRE)--Alliant Energy Corporation (NASDAQ: LNT) announced today that it intends to offer, subject to market and other conditions, $500 million aggregate principal amount of its convertible senior notes due 2026 in a private placement under the Securities Act of 1933, as amended (the “Securities Act”).

Alliant Energy Announces Proposed Offering of $500 Million of Convertible Senior Notes due 2026

Alliant Energy Corporation (NASDAQ:LNT ) Q4 2022 Earnings Conference Call February 24, 2023 10:00 AM ET Company Participants Susan Gille - IR Manager John Larsen - Chair, President and CEO Robert Durian - EVP and CFO Conference Call Participants Shahriar Pourreza - Guggenheim Partners Julien Dumoulin-Smith - Bank of America Nicholas Campanella - Credit Suisse Andrew Weisel - Scotiabank Alexander Mortimer - Mizuho Ashar Khan - Verition Operator Good morning, and welcome to Alliant Energy's Conference Call for Fourth Quarter and Year End 2022 Results. This call is being recorded for rebroadcast.

Alliant Energy Corporation (LNT) Q4 2022 Earnings Call Transcript

Alliant Energy Corporation's (LNT) fourth-quarter earnings lag estimates, while revenues increase year over year.

Alliant Energy (LNT) Q4 Earnings Miss Estimates, Sales Up Y/Y

MADISON, Wis.--(BUSINESS WIRE)--Alliant Energy Corporation (NASDAQ: LNT) today announced U.S. generally accepted accounting principles (GAAP) and non-GAAP consolidated unaudited earnings per share (EPS) for 2022 and 2021 as follows:   GAAP EPS   Non-GAAP EPS   2022   2021   2022   2021 Utilities and Corporate Services $2.74   $2.52   $2.76   $2.52 American Transmission Company (ATC) Holdings 0.12   0.12   0.14   0.12 Non-utility and Parent (0.13)   (0.01)   (0.10)   (0.

Alliant Energy Announces 2022 Results

Alliant Energy Corporation's (LNT) fourth-quarter earnings are likely to have gained from investments in solar projects and regulatory initiatives related to solar and battery storage.

Alliant Energy (LNT) to Report Q4 Earnings: What to Expect

Award based on independent survey of 45,000 U.S. employees across 25 industries Award based on independent survey of 45,000 U.S. employees across 25 industries

Forbes names Alliant Energy a ‘Best Employer' of 2023

MADISON, Wis., Jan. 24, 2023 (GLOBE NEWSWIRE) -- Alliant Energy Corporation (NASDAQ: LNT) has scheduled its year-end 2022 earnings release for Thursday, February 23rd, after market close. A conference call to review the year-end results is scheduled for Friday, February 24th at 9 a.m. CT.

Alliant Energy Corporation Announces Year-End 2022 Earnings Release and Conference Call

Former AEP Executive Vice President and COO brings deep industry knowledge, strong leadership abilities and proven operating expertise to further Alliant Energy's commitment to deliver safe, reliable and affordable clean energy Former AEP Executive Vice President and COO brings deep industry knowledge, strong leadership abilities and proven operating expertise to further Alliant Energy's commitment to deliver safe, reliable and affordable clean energy

Alliant Energy Appoints Industry Veteran Lisa Barton as President and Chief Operating Officer

Company's commitment to sustainability, social causes drives recognition Company's commitment to sustainability, social causes drives recognition

Alliant Energy named to Newsweek's Most Responsible Companies list for third consecutive year

Alliant Energy's non-GAAP EPS payout ratio will edge slightly higher from 61.3% in 2022 to 62.6% in 2023. The company's revenue surged 14.8% higher in the nine months ended 2022 while non-GAAP EPS edged 2.6% higher during that time.

Alliant Energy: Buy This Blue-Chip Stock For Growing Passive Income And Strong Returns

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MADISON, Wis., Jan. 04, 2023 (GLOBE NEWSWIRE) -- Alliant Energy Corporation (NASDAQ: LNT) today announced that its Board of Directors has appointed Stephanie Cox as a new independent director effective February 11, 2023. In addition, Dean Oestreich, an Alliant Energy director since 2005, is retiring from the Board, effective with Ms. Cox's appointment.

Alliant Energy Announces Appointment of Stephanie Cox to Board of Directors and Retirement of Board Member Dean Oestreich

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Alliant Energy (LNT) makes a strong case for investment, given its estimate revision history, earnings surprise history and systematic investments to strengthen its infrastructure and serve customers efficiently.

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