IDA research note 04-26-13.pdf

Please refer to pages 2-3 of this report for detailed disclosure and certification information.
* D. A. Davidson & Co. makes a market in this security.
RESEARCH NOTE
Institutional Equity Research

IDACORP, Inc.
April 26, 2013 IDA* – NYSE

Rating: Buy
Price: (4/26/13) $48.51
Price Targets: 12-18 month: $53.00
5-year: $60.00

Industry:
Utilities

Michael Bates
503.603.3045
[e-mail]

Preview: Modeling Solid Up-Tick in 1Q Earnings

IDACORP is scheduled to report 1Q’13 earnings on Thursday May 2nd before the
market opens. A conference all with management will be held the same day at
4:30 pm ET/1:30 pm PT. 
Earnings estimates. We are forecasting 1Q EPS of $0.62, a $0.12 improvement from
last year and above the Street mean of $0.55. On a full-year basis, we are forecasting
EPS of $3.30, down from $3.37 in 2012, slightly above the $3.26 consensus and in the
upper half of management’s $3.20-$3.35 guidance.
Key Areas of Focus: 
 Expecting margin improvement. We are forecasting quarterly gross margin of
$183 million, up ~11% from 1Q’12. The expected increase should be driven by
higher retail rates and the commercial operation of the Langley Gulch plant. The
increased margins should be slightly offset by increased operating expenses.  
 Weather. Cold winter weather should provide additional support for a strong
earnings comparison, with 1Q’13 heating degree days recorded at 23%-28%
above the year-ago quarter and 8%-10% above the long-term average.
 Upcoming IRP. Investors will be looking for additional detail around IDA’s June
2013 Integrated Resource Plan (IRP) filing. Earlier this year, management noted
that preliminary demand forecasts point to more moderate demand growth than
previously expected, weakening the potential for additional generation build-out
over the next five years.
 PCA filing. On April 15th Idaho Power filed its annual Power Cost Adjustment
(PCA) mechanism with regulators in Idaho, requesting a $140 million rate
increase to mitigate headwinds related to weak stream flows into its hydro system
(projected to be less than 65% of the historical average) and lower than expected
revenue from surplus power sales. The IPUC (Idaho Public Utilities Commission)
has 45 days to review the proposal, for an expected implementation date of June
1, 2013. The weak hydrogeneration outlook should not materially impact IDA’s
earnings because the PCA mechanism defers the unexpected variation between
actual and forecasted power supply costs, with 95% of the positive/negative
variance later allocated to customers and 5% to IDA.
BUY rated. Our $53 target equates to 15.7x our 2014 EPS estimate of $3.38.

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.
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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 3/31/2013) Buy Hold Sell
Corresponding Institutional Research Ratings Buy Neutral Underperform
and Distribution 52% 44% 4%
Distribution of companies from whom D.A. Davidson & Co. has received compensation for investment banking services in last 12 mos.
Institutional Coverage 9% 5% 18%

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.
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
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