We are lowering our Dominion Energy fair value estimate to $59 per share from $70 after changing our economic moat rating to narrow from wide. Dominion’s stock trades in line with our new fair value estimate.

Our moat downgrade was triggered by our expectation that Dominion’s next most likely strategic move is divesting part or all its nonutility contracted assets portfolio, which previously supported our wide moat rating. Additionally, while we think Virginia regulation will remain constructive and support long-term growth, political headwinds lead us to believe Virginia will no longer be one of the best regulatory environments for investor-owned utilities. No U.S. utility has a wide moat rating.



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