BofA Upgrades Black Hills, Cites Merger Benefits

BofA upgraded Black Hills Corporation (BKH) to Buy from Neutral, increasing its price target to $78. The firm anticipates the completion of Black Hills' merger with NorthWestern Energy, believing the market is overlooking its strategic advantages. This combination is expected to enhance scale, strengthen financial footing, and diversify operations. The merger will also expand infrastructure opportunities in areas like data centers and power generation.

Analysts specifically noted Wyoming as an emerging and undervalued data center market. The state exhibits active sites and ongoing projects, supported by robust political and regulatory backing for growth. The Jade project was highlighted for its significant expansion potential. Black Hills Corporation provides essential utility services to 1.35 million natural gas and electric customers across eight states.