Barclays Upgrades PPL Corp to Overweight with a $40 Price Target
Barclays has upgraded PPL Corporation (NYSE: PPL), a major U.S. utility holding company, from Equal Weight to Overweight, establishing a price target of $40 per share. The upgrade reflects the analyst firm’s view that PPL offers above-average earnings growth with improving visibility, at a valuation that has become attractive after the stock lagged its utility peers over the past month.
Why the Rating Changed
Barclays cited several specific factors driving the upgrade:
- Superior EPS growth trajectory: Barclays’ 2026–2028 earnings per share estimates project a compound annual growth rate (CAGR) of over 9% for PPL, compared to an approximate 7% CAGR for the utility peer group. The firm’s 2028 EPS estimate of $2.37 per share sits roughly 4% above the current consensus, suggesting the market may be underappreciating PPL’s earnings potential.
- Data center upside via Blackstone joint venture: Barclays conservatively models 1 GW of data center capacity coming online in 2029 through PPL’s joint venture with Blackstone, which would contribute an estimated $0.04 per share in EPS accretion. This represents a tangible growth catalyst tied to the expanding demand for data center infrastructure — a theme gaining momentum across the utility sector.
- Constructive Pennsylvania rate case setup: According to Seeking Alpha’s coverage of the upgrade, Barclays views PPL as well-positioned for a constructive outcome in its Pennsylvania rate case, which could provide further regulatory support for the company’s capital investment plans.
- Discounted valuation: Barclays noted that PPL shares have underperformed utility peers over the past month, creating a more attractive entry point. The firm characterized the stock as offering “above-average, increasingly visible earnings per share growth with a discounted valuation.”
- Aggressive capital expenditure program: Recent news reports highlight that PPL has boosted its capital expenditure plan to $23 billion, positioning the company to capitalize on rising electricity demand, including from data centers and the broader energy transition.
Additionally, PPL recently launched a $1 billion equity units offering of 20 million units at $50 per unit with stock purchase contracts, a move that bolsters the company’s balance sheet to fund its growth initiatives.
PPL’s Dividend Profile
PPL Corp currently pays an annual dividend of $1.14 per share, which translates to a dividend yield of approximately 3.06% at recent prices. The most recent ex-dividend date was March 9, 2026.
While PPL’s yield is modest compared to some higher-yielding utility names, Barclays’ growth thesis suggests the company is prioritizing capital reinvestment to drive long-term earnings expansion. Recent reporting indicates that PPL is targeting steady dividend growth alongside its elevated capital spending program. For dividend investors, the combination of a 3%+ yield with a projected 9%+ EPS CAGR could offer an attractive total return profile if the growth plan executes as expected.
What This Means for Investors
Barclays’ upgrade positions PPL as a growth-oriented utility play with multiple catalysts on the horizon — including data center demand, a supportive rate case environment, and a well-funded capital plan. The $40 price target implies meaningful upside potential and suggests the firm believes the market has not yet fully priced in PPL’s earnings growth trajectory relative to peers.
Disclaimer: This blog post is for informational purposes only and does not constitute financial advice. Analyst ratings and price targets reflect the opinions of the issuing firms and are subject to change. Investors should conduct their own due diligence and consult with a qualified financial advisor before making investment decisions.