11:27 AM EDT, 03/13/2024 (MT Newswires) -- IDACORP's ( IDA ) increasing sales growth has led to a shift in the projected rate base outlook, Morgan Stanley said in a note emailed Wednesday.

Morgan Stanley initiated IDACORP ( IDA ) at equal-weight with a price target of $92, saying the price reflected a balance between the company's strong short-term growth prospects, favorable regulatory conditions and moderate fire-risk potential.

IDACORP's ( IDA ) shares "fairly balance" the upside growth opportunity against wildfire risk in its service territory, Morgan Stanley said.

The company's service area faces elevated wildfire risk, influencing a persistent reduction in the stock's premium, Morgan Stanley said. IDACORP ( IDA ) has implemented strong operational measures such as system hardening and advanced vegetation management to mitigate this risk.

"But given the severity of recent fires in other states involving utility equipment, and the company's smaller balance sheet than peers, we think investors will haircut the historical premium the stock previously garnered," Morgan Stanley said.

The Idaho-based electricity holding company has shown promising growth potential but more evidence was needed for the stock to fully reflect this opportunity, Morgan Stanley said.

"We would wait for further evidence before baking in potential upside," the firm said.

Price: 90.67, Change: -0.59, Percent Change: -0.65