Pinnacle West Capital (PNW) Resuming February Decline

Conclusion, Investment Implications, Strategy

Pinnacle West Capital Corporation (PNW) appears to be resuming its February decline following 3 months of sideways investor decision. A sustained decline below the $75.97 area would confirm this and target an additional 26% decline to $54.50 per share. This is an Asbury Momentum idea.

Analysis and Rationale

Pinnacle West Capital Corporation (PNW), through its subsidiary, Arizona Public Service Company, provides retail and wholesale electric services primarily in the state of Arizona. The company generates, transmits, and distributes electricity using coal, nuclear, gas, oil, and solar generating facilities. Its transmission facilities consist of approximately 6,192 pole miles of overhead lines and approximately 49 miles of underground lines; distribution facilities comprise approximately 11,191 miles of overhead lines and approximately 22,092 miles of underground primary cable. The company serves approximately 1.3 million customers. It owns or leases approximately 6,316 megawatts of regulated generation capacity. The company was incorporated in 1985 and is headquartered in Phoenix, Arizona.

Chart 1 below plots PNW daily since January and shows that price is currently breaking down from about 3 months sideways price activity that is indicative of investor indecision. This recent breakdown suggests the larger February decline is resuming and targets an additional 26% decline to $54.50 per share. This downside target will remain valid as long as the upper boundary of the indecision area, currently situated near $75.97, now loosely contains as overhead resistance.

Chart 1

Table 1 below shows, considering the aforementioned downside target and a protective stop placed above the $77.76 area, a short entry price of $74.00 would provide a 1:5.2 risk/reward ratio (risking $1.00 to make $5.20) with an initial risk of 5.1.

Table 2

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Please consult the table showing our Asbury 6 key market metrics to help determine if this investment is suitable for you.

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Pinnacle West Capital (PNW) Resuming February Decline

Conclusion, Investment Implications, Strategy

Analysis and Rationale

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Pinnacle West Capital (PNW) Resuming February Decline

Conclusion, Investment Implications, Strategy

Analysis and Rationale

Asbury Research

Asbury Research subscribers get more detail on our latest analysis, and updates to our quantitative models

Schedule A 15-Minute Zoom Meeting With Us To Get More Information >>>

Asbury Research subscribers get more detail on our latest analysis,
and updates to our quantitative models