| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 17.12 | -63 |
| Intrinsic value (DCF) | 0.09 | -100 |
| Graham-Dodd Method | 11.90 | -74 |
| Graham Formula | 0.28 | -99 |
New Jersey Resources Corporation (NJR) is a diversified energy services holding company operating primarily in the regulated gas distribution and clean energy sectors. Headquartered in Wall, New Jersey, NJR serves approximately 564,000 residential and commercial customers across multiple counties in New Jersey through its Natural Gas Distribution segment. The company also invests in solar energy projects via its Clean Energy Ventures segment, spanning New Jersey, Connecticut, Rhode Island, and New York. Additionally, NJR provides wholesale energy management services and maintains a portfolio of natural gas storage and transportation assets through its Energy Services and Storage & Transportation segments. With a market capitalization of approximately $4.59 billion, NJR plays a critical role in the Northeast's energy infrastructure, balancing traditional utility services with growing investments in renewable energy. The company’s diversified business model positions it well in the evolving energy landscape, where demand for clean energy solutions continues to rise alongside traditional gas distribution needs.
New Jersey Resources Corporation (NJR) presents a stable investment opportunity within the utilities sector, supported by its regulated gas distribution business, which provides consistent cash flows. The company’s expansion into clean energy, particularly solar projects, aligns with broader industry trends toward sustainability, potentially offering long-term growth. However, NJR’s high debt levels ($3.52 billion) and capital-intensive operations pose financial risks, particularly in a rising interest rate environment. The company’s beta of 0.679 suggests lower volatility compared to the broader market, making it attractive for conservative investors. Dividend investors may find NJR appealing with a dividend yield of approximately 3.85% (based on a $1.77 annual dividend and recent stock price). Regulatory risks and exposure to fluctuating natural gas prices remain key considerations for potential investors.
NJR’s competitive advantage lies in its diversified energy portfolio, combining stable regulated gas distribution with growth-oriented clean energy investments. Its regulated utility segment provides a reliable revenue stream, while its Clean Energy Ventures segment capitalizes on state-level renewable energy incentives, particularly in New Jersey, which has aggressive solar energy targets. The company’s wholesale energy services and storage assets further enhance its market positioning by leveraging commodity price arbitrage opportunities. However, NJR faces competition from larger regional utilities with greater scale and financial flexibility. Its solar investments compete with specialized renewable energy firms, while its wholesale energy services contend with larger, more diversified energy traders. NJR’s regional focus in the Northeast provides localized expertise but limits geographic diversification compared to national players. The company’s ability to navigate regulatory frameworks and maintain cost efficiency in its utility operations will be critical in sustaining its competitive edge.