COC IDA research note 06-23-09.pdf

Please refer to pages 2-3 of this report for detailed disclosure and certification information.

RESEARCH NOTE
Institutional Equity Research

IDACORP, INC.
June 23, 2009 IDA – NYSE

Rating:
NEUTRAL

Price: (6/22/09) $25.61

Price Targets:
12-18 month: $25.50 ↑
5-year: $35

Industry:
Utilities

James L. Bellessa, Jr., CFA
406.791.7230
[e-mail]

Regulators Deny Request to Delay Hearings for Natural Gas Plant.
Raising Target Price.

• Joint motion to stay denied. On June 22nd, the Idaho Public Utilities
Commission (IPUC) said it will commence on July 14th both the public hearing
and technical hearing scheduled to consider Idaho Power’s request for a
Certificate of Public Convenience and Necessity (CPCN) to build the Langley
Gulch plant (a 300-megawatt combined-cycle generating facility). On May 29th,
intervenors in the case had filed a joint motion with the IPUC to stay the
proceedings, in attempt to delay commencement of construction for at least ten
months. They argued that conditions have changed and uncertainties have arisen
since the utility first sought the CPCN last March (see our Research Note dated
June 2, 2009).
• Group can renew motion to stay. The Commission said there will always be
uncertainty about future conditions. “However, we can’t allow that uncertainty to
paralyze us. There are very real consequences to the requested stay.” While the
intervenors may renew their motion to stay or express their concerns during the
technical hearings, the Commission placed weight on Idaho Power’s view that
delaying the project would substantially increase its costs and jeopardize the
company’s ability to serve its customers by 2012 and thereafter. The IPUC set a
July 24th deadline for written comments.
• Hiking target price and maintaining rating. We are increasing our 12-18
month target price of $24 to $25.50, or ~10.7x our 2010 EPS estimate of $2.39 to
reflect: 1) reduced risks of a delay of the Langley Gulch plant; 2) improved hydro
conditions going into the cooling season due to late spring rains; and 3) higher
multiples accorded the utility sector in the past three weeks. At the current share
price, we are maintaining a NEUTRAL rating.
D.A. Davidson & Co.
Two Centerpointe Drive, Suite 400 • Lake Oswego, Oregon 97035 • [phone] • [phone] • www.dadavidson.com
Copyright D.A. Davidson & Co., 2009. All rights reserved.
2
Required Disclosures
D.A. Davidson & Co. expects to receive, or intends to seek, compensation for investment banking services from this company in the
next three months.
D.A. Davidson & Co. is a full service investment firm that provides both brokerage and investment banking services. James L.
Bellessa, Jr., CFA, the research analyst principally responsible for the preparation of this report, will receive compensation that is
based upon (among other factors) D.A. Davidson & Co.’s investment banking revenue. However, D.A. Davidson & Co.’s analysts are
not directly compensated for involvement in specific investment banking transactions.
I, James L. Bellessa, Jr., CFA, attest that (i) all the views expressed in this research report accurately reflect my personal views about
the common stock of the subject company, and (ii) no part of my compensation was, is, or will be, directly or indirectly, related to the
specific recommendations or views expressed in this report.

Ratings Information

D.A. Davidson & Co. Ratings Buy Neutral Underperform
Risk adjusted return potential Over 15% total return
expected on a risk adjusted
basis over next 12-18 months
>0-15% return potential
on a risk adjusted basis
over next 12-18 months
Likely to remain flat or lose
value on a risk adjusted basis
over next 12-18 months
Distribution of Ratings (as of 3/31/09) Buy Hold Sell
Corresponding Institutional Research Ratings Buy Neutral Underperform
and Distribution 47% 47% 6%
Corresponding Private Client Research Ratings Outperform Market Perform Underperform
and Distribution 86% 9% 5%
Distribution of Combined Ratings 51% 44% 6%
Distribution of companies from whom D.A. Davidson & Co. has received compensation for investment banking services in last 12 mos.
Institutional Coverage 2% 3% 9%
Private Client Coverage 0% 0% 0%
Distribution of Combined Investment Banking 2% 3% 8%

D.A. Davidson & Co.’s Institutional Research Rating Scale (maintained since 7/9/02): Buy, Neutral, Underperform
D.A. Davidson & Co.
Two Centerpointe Drive, Suite 400 • Lake Oswego, Oregon 97035 • [phone] • [phone] • www.dadavidson.com
Copyright D.A. Davidson & Co., 2009. All rights reserved.
3
Target prices are our Institutional Research Department’s evaluation of price potential over the next 12-18 months and 5 years, based
upon our assessment of future earnings and cash flow, comparable company valuations, growth prospects and other financial criteria.
Certain risks may impede achievement of these price targets including, but not limited to, broader market and macroeconomic
fluctuations and unforeseen changes in the subject company’s fundamentals or business trends.

Other Disclosures

Information contained herein has been obtained by sources we consider reliable, but is not guaranteed and we are not soliciting any
action based upon it. Any opinions expressed are based on our interpretation of data available to us at the time of the original
publication of the report. These opinions are subject to change at any time without notice. Investors must bear in mind that inherent
in investments are the risks of fluctuating prices and the uncertainties of dividends, rates of return and yield. Investors should also
remember that past performance is not necessarily an indicator of future performance and D.A. Davidson & Co. makes no guarantee,
express or implied, as to future performance. Investors should note this report was prepared by D.A. Davidson & Co.’s Institutional
Research Department for distribution to D.A. Davidson & Co.’s institutional investor clients and assumes a certain level of investment
sophistication on the part of the recipient. Readers, who are not institutional investors or other market professionals, should seek the
advice of their individual investment advisor for an explanation of this report’s contents, and should always seek such advisor’s advice
before making any investment decisions. Further information and elaboration will be furnished upon request.