DADavidson-Feb-22-2013.pdf

Please refer to pages 6-7 of this report for detailed disclosure and certification information.
* D. A. Davidson & Co. makes a market in this security.
Institutional Equity Research

IDACORP, Inc.
February 22, 2013 IDA* – NYSE

Rating: Buy
Price: (2/21/13) $46.73
Price Targets: 12-18 month: ↑ $53.00
5-year: $60.00

Industry:
Utilities

Michael Bates
503.603.3045
[e-mail]

Moderating Demand Tempers Expectations for New Generation

 IDACORP reported 4Q EPS of $0.33 versus $0.18 a year ago. Results were
ahead of our estimate of $0.30, which matched consensus. On a full-year basis,
GAAP EPS of $3.37 increased from $3.36 in 2011 and was in line with guidance
($3.30-$3.40). Excluding nonrecurring tax benefits in both years, we estimate
2012 non-GAAP EPS of $3.22 increased from $2.22 in 2011.
 2013 guidance was initiated at $3.20-$3.35, compared to our previous 2013
EPS estimate of $3.35 and the Street mean of $3.24. The expected increase from
normalized 2012 results assumes a return to normal weather conditions, with
minimal use of ADITCs to meet the utility’s ROE threshold.
 2013 IRP. Management disclosed that preliminary demand forecasts to be
included in Idaho Power’s June 2013 Integrated Resource Plan (IRP) will be more
moderate than previously expected. Previous speculation that the delay of the
Boardman-Hemingway line could prompt a need for new generating capacity by
2016 appears to stand on a much weaker foundation; one demand scenario
projects a resource capacity deficit of less than 100 MW in 2016. Due to the
relatively manageable deficit expected, IDA appears more likely to bridge the
capacity gap without a material addition to rate base.
 Reducing estimates. We are reducing our 2013 and 2014 estimates to reflect a
more modest rate of load growth than previously expected.
 We are increasing our price target to $53 (previously $50) to reflect the peer
group’s recent multiple expansion. Our target equates to ~15.5x our 2014 EPS
forecast. We continue to rate the shares BUY, due to its favorable regulatory
environment and strong dividend growth outlook.

Valuation Data
Long-term growth rate (E) 4%
Total Debt/Cap (12/31/12) 47.8% Cash per share (12/31/12) $0.55 Book value per share (12/31/12) $36.38 Dividend (yield) $1.52 (3.3%) Return on Equity (T-T-M) 9.9%

Trading Data
Shares outstanding (M) 48.3
Market Capitalization ($M) $2,259
52-week range $38.17 - $47.82
Average daily volume (3 mos.) (K) 181
Float 99%
Index Membership S&P 400

FY (Dec) 2012A 2013E Previous 2014E Previous
Revenue ($M) Q1 (Mar) $241 $253 E $257 n.a.n.a.
Q2 (Jun) $255 $255 E $257 n.a.n.a.
Q3 (Sep) $334 $358 E $364 n.a.n.a.
Q4 (Dec) $251 $253 E $277 n.a.n.a.
$1,081 $1,119 E $1,156 $1,148 $1,180
Price/Revenue 2.2x 2.1x 2.0x
EPS Q1 (Mar) $0.50 $0.62 E $0.57 n.a.n.a.
Q2 (Jun) $0.71 $0.68 E $0.61 n.a.n.a.
Q3 (Sep) $1.84 $1.64 E $1.49 n.a.n.a.
Q4 (Dec) $0.33 $0.36 E $0.68 n.a.n.a.
$3.37 $3.30 E $3.35 $3.38 $3.40
Price/EPS 13.8x 14.2x 13.8x
EBITDA ($M) Q1 (Mar) $81 $91 E $88 n.a.n.a.
Q2 (Jun) $93 $95 E $90 n.a.n.a.
Q3 (Sep) $147 $158 E $147 n.a.n.a.
Q4 (Dec) $71 $76 E $95 n.a.n.a.
$393 $420 E $419 $435 $432
EV/EBITDA 9.8x 9.1x 8.8x

D.A. Davidson & Co.
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Price Chart
Source: Capital IQ

Company Description:
Boise, ID -- IDACORP, Inc. is the holding company for the Idaho Power Company, an electric public utility that serves an approximate
24,000 square mile area in Southern Idaho and Eastern Oregon. Non-regulated subsidiaries include an affordable housing project
finance company and an operator of small hydroelectric generation projects.

Potential Risks:
 Regulatory/Legislative. Changes in the regulatory and/or legislative environment could influence the utility’s business practices,
credit ratings/access to capital markets, rate structure, cost recovery, and ability to achieve adequate returns on its investments.
 Economic and weather conditions. The firm’s financial results and operating strategy are sensitive to the economic climate
(including fluctuations in commodity prices) and regional weather conditions (including streamflows).
 Project delays or cancellations. Development of the utility’s projects could be delayed or cancelled for numerous reasons.
 Interest rates. Access to capital under competitive terms is critical to the company’s capital expenditure programs. Interest rate
increases may also lead to compression in utility stock prices.
 Litigation. Electric utilities commonly face legal challenges regarding their electric generating facilities, particularly coal-fired units.
These matters often stretch out over long time periods and can have unpredictable outcomes. In the event an adverse outcome
were handed down, the impact could be significant, despite the firm’s mitigation efforts.

D.A. Davidson & Co.
3
Quarterly Financial Position
Source: Company reports
$ millions -- Fiscal year ends 12/31 2010 1Q'11 2Q'11 3Q'11 2011 1Q'12 2Q'12 3Q'12 2012
Current Assets:
Cash And Cash Equivalents $228.7 $93.9 $58.3 $31.3 $27.8 $8.9 $14.4 $20.2 $26.5
Receivables from Customers 62.1 66.6 61.7 75.5 66.3 68.2 62.8 80.2 66.1
Other Receivables 10.2 13.4 8.1 10.7 8.2 14.1 15.6 20.9 25.4
Accrued Unbilled Revenues 48.0 41.6 49.8 49.4 46.4 37.1 60.2 49.9 51.4
Materials And Supplies 45.6 45.9 45.7 46.6 46.5 48.4 48.4 48.5 51.0
Fuel Stock 27.5 33.6 48.4 49.7 47.9 56.5 59.2 52.6 42.4
Prepayments 11.1 9.2 11.0 11.2 12.4 11.3 13.5 13.0 12.8
Deferred Income Taxes 10.7 9.5 7.4 3.9 16.2 37.4 46.6 45.8 56.5
Other 16.8 23.0 36.3 30.9 39.3 41.4 37.3 34.8 35.0
Total Current Assets $460.6 $336.8 $326.6 $309.3 $311.0 $323.3 $358.1 $366.0 $367.3
Property, Plant And Equipment - Net 3,161.4 3,232.6 3,307.0 3,356.0 3,406.6 3,420.6 3,473.0 3,506.8 3,536.0
Investments 202.9 202.6 198.3 192.3 199.9 196.0 198.1 190.7 189.0
Regulatory Assets 756.6 723.9 717.4 880.4 953.1 963.1 979.3 1,049.1 1,133.0
Other 94.5 94.4 93.1 88.9 90.0 87.7 94.5 95.0 94.3
Total Assets $4,676.1 $4,590.2 $4,642.3 $4,826.9 $4,960.6 $4,990.6 $5,103.0 $5,207.6 $5,319.5
Current Liabilities:0.0 0.0
Long-Term Debt Due Within One Year $122.6 $1.7 $1.7 $1.7 $101.1 $1.1 $1.1 $1.1 $71.1
Notes Payable 66.9 74.1 66.4 51.5 54.2 63.0 64.7 51.4 69.7
Accounts Payable 103.1 64.6 87.0 90.1 100.4 71.3 92.0 93.4 90.2
Taxes Accrued 0.0 4.1 22.9 8.8 0.5 2.8 5.5 0.9 1.0
Interest Accrued 23.9 23.8 22.3 23.4 21.8 23.4 22.1 23.9 22.3
Uncertain Tax Positions 74.4 73.7 56.9 0.0 0.0 0.0
Other 58.1 89.3 82.5 79.0 91.2 122.3 111.2 97.5 97.1
Total Current Liabilities $449.1 $331.3 $339.7 $254.5 $369.2 $283.9 $296.6 $268.3 $351.30.
Long-Term Debt 1,488.3 1,487.3 1,487.4 1,487.5 1,387.6 1,486.6 1,536.5 1,536.6 1,466.6
Deferred Income Taxes 566.5 577.6 586.9 750.0 772.0 806.5 832.6 877.2 894.6
Regulatory Liabilities - Other 298.1 296.8 307.7 332.7 332.1 332.2 333.8 348.2 355.4
Pension & Postretirement Benefits 363.2 335.5 341.9 339.3 423.4
Other 338.2 #343.7 353.9 341.4 74.8 #71.5 65.1 63.8 65.2.
Common Equity 1,532.1 1,550.0 1,563.1 1,656.8 1,657.7 1,670.6 1,692.3 1,770.0 1,758.8
Noncontrolling Interest 3.9 3.6 3.7 4.0 4.0 3.9 4.1 4.3 4.2
Total Capitalization And Liabilities $4,676.1 $4,590.2 $4,642.3 $4,826.9 $4,960.6 $4,990.6 $5,103.0 $5,207.6 $5,319.5
Common Shares Outstanding - End 49.3 49.6 49.7 49.8 49.8 50.1 50.2 48.6 48.3
Book Value Per Share $31.09 $31.28 $31.44 $33.29 $33.26 $33.35 $33.74 $36.39 $36.38
Capital Structure:
Common Equity 47.8% 49.8% 50.2% 51.9% 51.9% 51.9% 51.4% 52.8% 52.3%
Long-Term Debt 50.1% 47.8% 47.7% 46.5% 46.5% 46.1% 46.6% 45.7% 45.6%
Short-Term Debt 2.1% 2.4% 2.1% 1.6% 1.7% 2.0% 2.0% 1.5% 2.1%
Capitalization 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
D.A. Davidson & Co.
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Historical and Forecasted Cash Flow
Source: Company reports and D.A. Davidson & Co. estimates
$ millions -- Fiscal year ends 12/31 2009 2010 2011 2012 2013e 2014e
Cash Flow from Operating Activities:
Net Income $124.4 $142.5 $166.9 $168.9 $165.0 $169.3
Depreciation & Amortization 118.6 121.8 124.7 128.6 134.8 138.2
Deferred Taxes And Invest. Tax Credits 19.0 41.7 (52.9) 26.3 0.0 0.0
Change In Regulatory Assets & Liabilities 57.8 46.5 68.0 (53.5)0.0 0.0
Pension and Postretirement Plan Expense 11.6 14.7 45.2 45.2 0.0 0.0
Pension and Postretirement Plan Contributions (7.6) (65.6) (22.1) (47.7)
AFUDC - Equity (7.6) (16.6) (25.5) (22.4) (14.1) (16.1)
Distributions from Equity Method Investments 12.5 6.5 2.5 18.5 0.0 0.0
Net Other Items (7.6) (7.8) 2.6 (8.2) (30.0) (30.0)
Operating Cash Flows before WC $321.2 $283.8 $309.4 $255.8 $255.7 $261.4
Net Change in Working Capital (36.8) 21.6 0.8 (6.5)0.0 0.0
Net Operating Cash Flow $284.4 $305.4 $310.2 $249.3 $255.7 $261.4
Cash Flow from Investing Activities:
Additions To Utility Plant (251.9) (338.3) (337.8) (239.8) (250.0) (285.0)
Sale Of Emission Allowances 2.4 6.4 6.3 2.7
Investments In Affordable Housing (5.8) (13.4) (1.6) (0.1)
Investments In Unconsolidated Affiliates 0.0 (7.0) 2.6 0.0
Net Other 13.0 23.9 (2.0) (6.7)
Net Investing Cash Flow ($242.4) ($328.3) ($332.4) ($243.8) ($250.0) ($285.0)
Cash Flow Before Financing $42.0 ($22.9) ($22.1) $5.4 $5.7 ($23.6)
Cash Flow from Financing Activities:
Dividends (56.8) (57.9) (59.7) (68.9) (79.9) (92.2)
Net Borrowing 43.3 212.1 (133.8) 64.4 69.7 107.8
Net Equity 22.9 47.8 15.6 2.8 8.0 8.0
Net Other (7.3) (3.4) (0.9) (5.1)0.0 0.0
Net Financing Cash Flow $2.1 $198.6 ($178.7) ($6.7) ($2.2) $23.6
Net Change in Cash 44.2 175.7 (200.9) (1.3) 3.5 0.0
Cash & Equivalents - End $53.0 $228.7 $27.8 $26.5 $30.0 $30.0
D.A. Davidson & Co.
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Historical and Projected Quarterly and Annual Operating Results
*Certain items previously reported as Other Income were reclassified as Other Operating Expense with the release of 2012 results to correct an accounting error (the error did not impact reported net
income). The reclassified amounts were not detailed by quarter.
Source: Company reports and D.A. Davidson & Co. estimates
$ millions -- Fiscal year ends 12/31 1Q'11 2Q'11 3Q'11 4Q'11 2011R 1Q'12 2Q'12 3Q'12 4Q'12 2012 1Q'13e 2Q'13e 3Q'13e 4Q'13e 2013e 2014e
Operating Revenues $251.5 $235.0 $309.6 $230.6 $1,026.8 $241.1 $254.7 $334.0 $250.8 $1,080.7 $253.1 $254.6 $358.4 $252.8 $1,118.9 $1,148.0
Power Supply Expenses 86.3 71.6 97.1 78.3 333.4 76.0 63.3 84.7 71.3 295.3 70.3 60.2 96.4 74.8 301.7 304.7
Gross Margin $165.2 $163.4 $212.5 $152.4 $693.4 $165.1 $191.4 $249.3 $179.5 $785.4 $182.8 $194.4 $262.0 $178.0 $817.3 $843.4
Operating Expenses:
Other Operations And Maintenance 70.7 85.5 84.6 97.9 338.6 78.5 86.0 90.0 94.5 349.0 80.3 88.0 90.8 91.1 350.2 362.6
Energy Efficiency Programs 6.7 5.8 18.5 6.7 37.7 4.5 8.1 8.4 6.3 27.3 5.1 5.1 7.2 5.1 22.4 23.0
Depreciation 29.5 29.7 30.1 30.5 119.8 30.5 29.9 31.6 31.9 123.9 33.6 32.9 34.0 34.3 134.8 138.2
Taxes Other than Income Taxes 7.2 7.2 7.3 7.2 28.9 8.1 7.8 7.0 7.5 30.5 8.0 8.0 8.1 8.1 32.2 32.6
Other Operating Expenses*1.1 0.9 0.6 1.6 13.0 1.1 0.8 1.0 1.0 12.0 3.0 3.0 3.0 3.0 12.0 12.0
Total Operating Expenses $115.1 $129.1 $141.1 $143.9 $538.0 $122.8 $132.6 $138.0 $141.3 $542.8 $130.0 $137.1 $143.1 $141.6 $551.7 $568.3
EBITD $82.8 $64.6 $109.6 $49.0 $306.0 $80.9 $93.3 $147.2 $71.5 $392.9 $91.2 $95.1 $157.9 $75.8 $420.1 $435.0
Operating Income $50.1 $34.3 $71.4 $8.4 $155.4 $42.3 $58.8 $111.3 $30.1 $242.6 $52.8 $57.4 $118.9 $36.4 $265.5 $275.1
AFUDC - Equity 5.3 6.4 6.6 7.2 25.5 7.6 7.8 3.5 3.4 22.4 3.4 3.5 3.6 3.7 14.1 16.1
Earnings Of Investments (1.3) (4.4) 2.1 4.5 0.8 1.4 (1.9) 1.3 (1.1) (0.3) 0.3 0.3 0.3 0.3 1.2 1.2
Other Income*4.5 5.0 6.0 (1.6)4.6 6.6 6.6 2.9 7.1 4.2 1.1 1.1 1.1 1.1 4.4 4.4
Net Interest Expense 19.0 17.6 17.4 17.5 71.5 17.2 17.4 19.4 19.8 73.9 18.0 18.5 18.8 18.5 73.7 79.7
Income Before Income Taxes $34.4 $17.3 $62.0 $1.0 $114.7 $33.2 $46.0 $96.2 $19.7 $195.0 $39.6 $43.8 $105.1 $23.0 $211.5 $217.1
Income Taxes 4.9 (3.7) (45.4) (8.0) (52.1) 8.3 10.6 3.9 3.3 26.1 8.7 9.6 23.1 5.1 46.5 47.8
Effective Tax Rate 14.2% -21.1% -73.1% -811.1% -45.4% 25.1% 23.0% 4.1% 16.7% 13.4% 22.0% 22.0% 22.0% 22.0% 22.0% 22.0%
Net Income $29.5 $21.0 $107.4 $9.0 $166.9 $24.8 $35.4 $92.3 $16.4 $168.9 $30.9 $34.2 $82.0 $18.0 $165.0 $169.3
Noncontrolling Interest 0.3 (0.1) (0.3) 0.0 (0.2) 0.1 (0.1) (0.2) 0.0 (0.2) 0.1 0.1 0.1 0.1 0.3 0.3
Net Income Available For Common $29.7 $20.9 $107.1 $9.0 $166.7 $24.9 $35.3 $92.1 $16.5 $168.8 $31.0 $34.2 $82.1 $18.0 $165.3 $169.6
Average Diluted Shares 49.4 49.5 49.6 49.7 49.6 49.9 50.0 50.1 50.1 50.0 50.1 50.1 50.1 50.1 50.1 50.1
Diluted EPS - GAAP $0.60 $0.42 $2.16 $0.18 $3.36 $0.50 $0.71 $1.84 $0.33 $3.37 $0.62 $0.68 $1.64 $0.36 $3.30 $3.38
Diluted EPS-Adjusted $0.60 $0.42 $1.01 $0.18 $2.22 $0.50 $0.71 $1.68 $0.33 $3.22 $0.62 $0.68 $1.64 $0.36 $3.30 $3.38
Ratio Analysis:
Return on Average Equity (ttm)10.5% 9.1% 11.4% 10.5% 10.5% 10.0% 10.7% 9.5% 9.9% 9.9% 10.1% 9.9% 9.2% 9.2% 9.2% 9.0%
Return on Average Assets (ttm)3.5% 3.0% 3.8% 3.5% 3.5% 3.4% 3.6% 3.2% 3.3% 3.3% 3.4% 3.3% 3.1% 3.1% 3.1% 3.1%
EBITDA Margin 32.9% 27.5% 35.4% 21.2% 29.8% 33.5% 36.6% 44.1% 28.5% 36.4% 36.0% 37.4% 44.1% 30.0% 37.5% 37.9%
Operating Margin 19.9% 14.6% 23.1% 3.7% 15.1% 17.6% 23.1% 33.3% 12.0% 22.4% 20.9% 22.5% 33.2% 14.4% 23.7% 24.0%
Pre-Tax Margin 13.7% 7.4% 20.0% 0.4% 11.2% 13.7% 18.1% 28.8% 7.9% 18.0% 15.7% 17.2% 29.3% 9.1% 18.9% 18.9%
Net Margin 11.8% 8.9% 34.6% 3.9% 16.2% 10.3% 13.9% 27.6% 6.6% 15.6% 12.2% 13.4% 22.9% 7.1% 14.8% 14.8%
Dividends Per Common Share $0.30 $0.30 $0.30 $0.30 $1.20 $0.33 $0.33 $0.33 $0.38 $1.37 $0.38 $0.38 $0.42 $0.42 $1.60 $1.84
Dividend Payout Ratio (ttm) 37.2% 42.4% 33.4% 35.7% 35.7% 37.7% 35.6% 40.0% 40.6% 40.6% 40.7% 42.4% 47.6% 48.3% 48.4% 54.3%
Dividend Growth 0.0% 0.0% 0.0% 0.0% 0.0% 10.0% 10.0% 10.0% 26.7% 14.2% 15.2% 15.2% 26.7% 10.0% 16.5% 15.2%
D.A. Davidson & Co.
Two Centerpointe Drive, Suite 400  Lake Oswego, Oregon 97035  [phone]  [phone]  www.dadavidson.com
Copyright D.A. Davidson & Co., 2013. All rights reserved.
6
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. Michael Bates, 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, Michael Bates, 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. Institutional Research Ratings Buy Neutral Underperform
Risk adjusted return potential azbycx
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 12/31/12) Buy Hold Sell
Corresponding Institutional Research Ratings Buy Neutral Underperform
and Distribution 54% 43% 3%
Distribution of companies from whom D.A. Davidson & Co. has received compensation for investment banking services in last 12 mos.
Institutional Coverage 7% 5% 0%

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., 2013. All rights reserved.
7
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.