The outlook for electricity demand is strong! Constellation Energy (CEG.US) and other US independent power producers all received Scotiabank's “outperforming the market” rating

The Zhitong Finance App learned that Scotiabank Canada has begun to cover independent US power producers such as Constellation Energy (CEG.US), NRG Energy (NRG.US), and Vistra Energy (VST.US), which first received a “outperforming market” rating. The target prices were $401, $212, and $256, respectively. The reason was “strong electricity demand prospects, plus upward and downward protection, and a stable balance sheet.”

Affected by this news, US stocks closed on Monday, with Constellation Energy up 4.90%, NRG Energy up 4.02%, and Vistra Energy up 3.14%.

Scotiabank analyst Andrew Weisel listed Constellation Energy as the industry's top choice, citing the company's leading position in multiple industry metrics and highlighting its best-in-class fleet portfolio, strong track record in innovation and execution, particularly in data center contracts and organic growth initiatives. Analysts say Constellation Energy is a “utility-like independent power producer (in the best sense).” He believes that the company combines the stability of a utility with the potential for growth as an independent power producer, and notes that the industry in which the company is experiencing an unprecedented peak in demand gives the company strong growth prospects.

Andrew Weisel named NRG Energy its “Value First Choice,” emphasizing that although NRG Energy “does not have the highest quality assets or business portfolio,” the company has demonstrated impressive execution. At the same time, he sees Vistra Energy as “a simple, high-quality independent power producer with a robust and highly diversified growth story, and an attractive asset portfolio in various auction markets, which can benefit from strong industry fundamentals.”

Furthermore, Andrew Weisel also gave Talen Energy (TLN.US) the “same as the market” rating for the first time, with a target price of $418.