Pinnacle West Vs. Avista: Why I'm Upgrading AVA

Pinnacle West's stock has re-rated to 21.9x forward earnings during a guided-down year, leaving little margin for error ahead of a politically charged rate case decision expected in Q4 2026. Avista disclosed a significant data center deposit on its Q4 call that could reshape the growth story for a utility trading below its historical valuation multiples. PNW's demand story in Arizona is real (5% sales growth, TSMC expanding), but the gap between spending and earning won't close until the rate case resolves.