IDA110711.pdf

Please refer to pages 5-6 of this report for detailed disclosure and certification information.
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Institutional Equity Research

IDACORP, INC.
November 7, 2011 IDA* – NYSE

Rating: Buy
Price: (11/4/11) $40.43
Price Targets: 12-18 month: ↑ $47.50
5-year: ↑ $55.00

Industry:
Utilities

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

Michael Bates
Research Associate
406.791.7216
[e-mail]

Raising Target on Unique Regulatory Proposal. Reiterating BUY.

 IDACORP reported 3Q'11 EPS of $2.16 on a GAAP basis, compared to $1.39 a
year ago. Improved results were largely a function of a $1.15 per share
recognition of a tax benefit associated with the utility’s change to a uniform
capitalization tax method of accounting. This sizeable tax benefit was offset by a
$0.36 per share reserve for a customer refund due to the fact that 2011’s earnings
are likely to exceed a 10.5% ROE in the utility’s Idaho territory, triggering a
customer sharing mechanism. Also, because of this year’s high ROE, the first
half benefit of $0.14 per share of accumulated deferred investment tax credits
(ADITC) was reversed. Operationally, results were helped by strong hydro
generation, warmer and drier weather, and the effects of rate and regulatory
mechanisms.
 Two important items divulged. First, management indicated that Idaho Power
has filed an application with its Idaho regulators requesting a continuation of the
use of ADITC to help achieve a minimum 9.5% return on year-end common equity
and the sharing of benefits between the utility and its customers when ROE
exceeds 10.0% (previously 10.5%). Second, management intends to propose a
formal dividend payout policy to the Board, calling for a dividend payout ratio of
between 50% and 60% of sustainable earnings. As we believe sustainable
earnings exceed $3.00 per share, we think the current $1.20 dividend will move
up gradually starting in 2012 to the $1.50-$1.80 level, with an initial 10% boost to
$1.32 annually starting in 1Q’12. If approved as we expect, these two items
should lift the share price.
 Raising estimates. Management increased its 2011 EPS guidance range to
$3.35-$3.45 from $2.80-$2.95. Due to the 3Q’11 positive variance from our $1.38
forecast and an expected $0.17 charge for to apply a one-time adjustment in
4Q’11 for the refund consideration contemplated by company’s aforementioned
proposed extension and modification, we are raising our 2011 EPS estimate to
$3.39 from $2.86. For 2012, we are increasing our EPS estimate to $3.25.
 Increasing our 12-18 month price target and reiterate BUY rating. We are
raising our target price from $44.50 to $47.50, which equates to ~14.6x our
revised 2012 EPS estimate. We believe the total return potential for investors is
very attractive and repeat our BUY rating.

Valuation Data
Long-term growth rate (E) 5%
Total Debt/Cap (9/30/11) 48.2% Cash per share (9/30/11) $0.63 Book value per share (9/30/11) $33.29 Dividend (yield) $1.20 (3.0%) Return on Equity (T-T-M) 11.2%

Trading Data
Shares outstanding (M) 49.8
Market Capitalization ($M) $2,012
52-week range $33.88 - $41.97
Average daily volume (3 mos.) (K) 409
Float 100%
Index Membership S&P 400

FY (Dec) 2010A 2011E Previous 2012E Previous
Revenue ($M) Q1 (Mar) $253.0 $251.5 A - $261.0 n.a.
Q2 (Jun) $241.8 $235.0 A - $246.7 n.a. Q3 (Sep) $309.4 $309.6 A $325.8 $337.5 n.a.
Q4 (Dec) $232.0 $227.0 E $233.2 $253.4 n.a.
$1,036.0 $1,023.1 E $1,045.4 $1,098.6 $1,106.8
Price/Revenue 1.9x 2.0x 1.9x
EPS Q1 (Mar) $0.34 $0.60 A - $0.70 n.a.
Q2 (Jun) $0.82 $0.42 A - $0.48 n.a.
Q3 (Sep) $1.39 $2.16 A $1.38 $1.43 n.a.
Q4 (Dec) $0.41 $0.21 E $0.46 $0.64 n.a.
$2.95 $3.39 E $2.86 $3.25 $3.00
Price/EPS 13.7x 11.9x 12.4x
EBITDA ($M) Q1 (Mar) $69.0 $86.2 A - $95.6 n.a.
Q2 (Jun) $70.2 $69.1 A - $82.6 n.a.
Q3 (Sep) $122.8 $108.7 A $129.6 $144.5 n.a.
Q4 (Dec) $73.7 $65.6 E $79.3 $96.0 n.a.
$335.7 $329.6 E $366.7 $418.7 $421.1
EV/EBITDA 10.5x 10.7x 8.4x

D.A. Davidson & Co.
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Price Chart
Source: FactSet

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 attract returns on its investments.
 Project delays or cancellations. The company is engaged in the development of projects which 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.
 Economic and weather conditions may influence demand for IDACORP’s products and services.

34.00
35.00
36.00
37.00
38.00
39.00
40.00
41.00
42.00
IDACORP Inc. (IDA-US)
04-Nov-2010 to 04-Nov-2011 (Daily) High:41.97 Low: 33.88 Last: 40.43
12/01/10 01/03/11 02/01/11 03/01/11 04/01/11 05/02/11 06/01/11 07/01/11 08/01/11 09/01/11 10/03/11 11/01/11
0.4M
0.8M
1.2M
©FactSet Research Systems
Volume in millions
D.A. Davidson & Co.
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IDACORP, Inc. - Quarterly Financial Position

Source: Company reports

$ millions -- Fiscal year ends 12/31 2008 2009 2010 1Q'11 2Q'11 3Q'11
Current Assets:
Cash And Cash Equivalents 8.8 53.0 228.7 93.9 58.3 31.3
Receivables from Customers 64.7 76.8 62.1 66.6 61.7 75.5
Other Receivables 10.3 13.0 10.2 13.4 8.1 10.7
Accrued Unbilled Revenues 43.9 51.3 48.0 41.6 49.8 49.4
Materials And Supplies 50.1 48.1 45.6 45.9 45.7 46.6
Fuel Stock 16.9 25.6 27.5 33.6 48.4 49.7
Prepayments 10.1 11.1 11.1 9.2 11.0 11.2
Deferred Income Taxes 37.6 31.8 10.7 9.5 7.4 3.9
Other Current Assets 23.9 ##(0.2)##16.8 ##23.0 36.3 30.9
Total Current Assets 266.3 310.4 460.6 336.8 326.6 309.3
Electric Plant:
In Service (At Original Cost) 4,030.1 4,160.2 4,332.1 4,354.6 4,388.5 4,451.4
Accumulated Provision For Depreciation (1,505.1) (1,558.5) (1,614.0) (1,633.5) (1,653.3) (1,669.1)
In Service - Net 2,525.0 2,601.6 2,718.0 2,721.0 2,735.2 2,782.3
Construction Work In Progress 207.7 289.2 417.0 485.2 545.6 547.8
Held For Future Use 6.3 7.2 7.1 7.1 7.1 7.0
Other Property, Net Of Accum. Depreciation 19.2 19.0 19.3 19.2 19.1 19.0
Property, Plant And Equipment - Net 2,758.2 2,917.0 3,161.4 3,232.6 3,307.0 3,356.0
Investments And Other Property 198.6 195.3 202.9 202.6 198.3 192.3
Regulatory Assets Associated With Taxes 696.3 720.4 756.6 723.9 717.4 880.4
Other Assets 103.5 ##95.6 ##94.5 ##94.4 93.1 88.9
Total Assets 4,022.8 4,238.7 4,676.1 4,590.2 4,642.3 4,826.9
Current Liabilities:0.0 0.0 0.0 0.0
Long-Term Debt Due Within One Year 86.5 9.3 122.6 1.7 1.7 1.7
Notes Payable 151.3 53.8 66.9 74.1 66.4 51.5
Accounts Payable 96.8 83.8 103.1 64.6 87.0 90.1
Taxes Accured 0.0 10.2 0.0 4.1 22.9 8.8
Interest Accrued 16.7 20.1 23.9 23.8 22.3 23.4
Uncertain Tax Positions 4.1 0.0 74.4 73.7 56.9 0.0
Other Current Liabilities 40.3 ##41.1 ##58.1 ##89.3 82.5 79.0
Total Current Liabilities 395.7 218.2 449.1 331.3 339.7 254.5
Long-Term Debt 1,183.5 1,409.7 1,488.3 1,487.3 1,487.4 1,487.5
Deferred Income Taxes 515.7 574.5 566.5 577.6 586.9 750.0
Regulatory Liabilities - Other 276.3 287.8 298.1 296.8 307.7 332.7
Other 344.9 ##347.0 ##338.2 ##343.7 353.9 341.4
Common Equity 1,302.4 1,397.3 1,532.1 1,550.0 1,563.1 1,656.8
Noncontrolling Interest 4.4 4.2 3.9 3.6 3.7 4.0
Total Capitalization And Liabilities 4,022.8 ##4,238.7 ##4,676.1 ##4,590.2 4,642.3 4,826.9
Common Shares Outstanding - End 46.9 47.9 49.4 49.6 49.7 49.8
Total Debt - End 1,421.2 1,472.8 1,677.8 1,563.1 1,555.5 1,540.6
Total Debt - Average 1,422.5 1,451.1 1,530.8 1,620.4 1,559.3 1,548.0
Book Value Per Share $27.76 $29.17 $31.00 $31.28 $31.44 $33.29
Current Ratio 0.7 1.4 1.0 1.0 1.0 1.2
Capital Structure:
Common Equity 47.9% 48.8% 47.8% 49.8% 50.2% 51.9%
Preferred Equity 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Debt (Short-Term & Long-Term)52.1% 51.2% 52.2% 50.2% 49.8% 48.1%
Capitalization 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
D.A. Davidson & Co.
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IDACORP, Inc. - Historical and Projected Operating Results

Source: Company reports and D.A. Davidson & Co. estimates
$ millions -- Fiscal year ends 12/31 1Q'10 2Q'10 3Q'10 4Q'10 2010 1Q'11 2Q'11 3Q'11 4Q'11E 2011E 1Q'12E 2Q'12E 3Q'12E 4Q'12E 2012E
Operating Revenues:
Electric Utility $252.5 $240.8 $308.5 $231.3 $1,033.1 $251.1 $233.9 $308.0 $226.2 $1,019.2 $260.0 $245.7 $336.5 $252.4 $1,094.6
Diversified Operations 0.5 1.0 0.9 0.6 3.0 0.4 1.1 1.6 0.9 3.9 1.0 1.0 1.0 1.0 4.0
Total Revenues $253.0 $241.8 $309.4 $232.0 $1,036.0 $251.5 $235.0 $309.6 $227.0 $1,023.1 $261.0 $246.7 $337.5 $253.4 $1,098.6
Operating Expenses:
Power Supply Expenses $106.7 $86.0 $92.6 $69.4 $354.7 $86.3 $71.6 $97.1 $73.1 $328.2 $83.6 $69.5 $92.9 $68.2 $314.2
Other Operations And Maintenance 72.1 75.1 71.9 74.8 293.9 70.7 85.5 84.6 75.6 316.3 72.8 88.4 80.8 77.0 319.0
Energy Efficiency Programs 5.0 8.8 19.5 10.8 44.2 6.7 5.8 18.5 11.0 42.0 7.0 6.0 19.0 12.0 44.0
Depreciation 28.6 28.7 29.1 29.5 115.9 29.5 29.7 30.1 30.3 119.5 30.5 30.7 33.0 33.3 127.5
Taxes Other Than Income Taxes 5.7 5.8 5.6 6.9 24.0 7.2 7.2 7.3 7.1 28.8 7.2 5.4 5.7 5.6 23.9
Total Electric Utility Expenses $218.1 $204.4 $218.9 $191.4 $832.7 $200.3 $199.8 $237.6 $197.0 $834.7 $201.1 $200.1 $231.4 $196.0 $828.6
Diversified Operations 0.8 0.7 1.5 1.6 4.6 1.1 0.9 0.6 1.2 3.8 1.2 1.2 1.2 1.2 4.8
Total Operating Expenses $218.9 $205.1 $220.4 $192.9 $837.4 $201.4 $200.7 $238.2 $198.2 $838.5 $202.3 $201.3 $232.6 $197.2 $833.4
EBITDA $69.0 $70.2 $122.8 $73.7 $335.7 $86.2 $69.1 $108.7 $65.6 $329.6 $95.6 $82.6 $144.5 $96.0 $418.7
Operating Income $34.0 $36.6 $89.0 $39.0 $198.7 $50.1 $34.3 $71.4 $28.8 $184.6 $58.6 $45.4 $105.0 $56.2 $265.2
Other Income 4.5 3.0 3.6 4.1 15.2 4.5 5.0 6.0 4.0 19.6 4.0 4.0 4.0 4.0 16.0
Earnings Of Uncons. Eq-Method Inv. (2.4) 0.4 3.4 1.6 3.0 (1.3) (4.4) 2.1 (1.4) (5.1) (1.0) (1.0) (1.0) (1.0) (4.0)
Interest On Long-Term Debt 19.4 19.4 20.1 21.5 80.5 20.8 19.5 19.5 20.5 80.4 20.7 20.9 21.1 21.3 84.0
Other Interest (0.5) (2.0) (1.4) (1.5) (5.4) (1.9) (1.9) (2.1) (2.1) (8.0) (2.1) (2.1) (2.1) (2.1) (8.4)
Income Before Income Taxes: $17.2 $22.6 $77.2 $24.7 $141.7 $34.4 $17.3 $62.0 $13.0 $126.8 $43.0 $29.6 $89.0 $40.0 $201.6
Income Taxes: 1.3 (16.6) 10.1 4.5 (0.7) 4.9 (3.7) (45.4) 2.6 (41.5) 8.2 5.6 16.9 7.6 38.3
Effective Tax Rate 7.6% -73.6% 13.1% 18.1% -0.5% 14.2% -21.1% -73.1% 20.0% -32.8% 19.0% 19.0% 19.0% 19.0% 19.0%
Income From Continuing Operations $15.9 $39.2 $67.1 $20.2 $142.5 $29.5 $21.0 $107.4 $10.4 $168.3 $34.9 $24.0 $72.1 $32.4 $163.3
Noncontrolling Interest 0.2 (0.0) 0.0 0.2 0.3 0.3 (0.1) (0.3) 0.1 (0.1) 0.1 0.1 0.1 0.1 0.3
Net Income Available For Common $16.1 $39.2 $67.1 $20.4 $142.8 $29.7 $20.9 $107.1 $10.5 $168.2 $34.9 $24.1 $72.1 $32.5 $163.6
Average Diluted Shares Outstanding 47.9 48.0 48.3 49.2 48.3 49.4 49.5 49.6 49.8 49.6 50.0 50.2 50.4 50.6 50.3
Diluted EPS $0.34 $0.82 $1.39 $0.41 $2.95 $0.60 $0.42 $2.16 $0.21 $3.39 $0.70 $0.48 $1.43 $0.64 $3.25
Dividends Per Common Share $0.30 $0.30 $0.30 $0.30 $1.20 $0.30 $0.30 $0.30 $0.30 $1.20 $0.33 $0.33 $0.33 $0.33 $1.32
Dividend Payout Ratio (ttm) 46.7% 42.9% 39.5% 40.6% 40.6% 37.2% 42.4% 33.4% 35.4% 35.4% 35.3% 35.5% 45.8% 40.6% 40.6%
Dividend Growth 0.0% 0.0% 10.0%
Ratio Analysis:
Gross Margin 57.8% 64.4% 70.1% 70.1% 65.8% 65.7% 69.5% 68.6% 67.8% 67.9% 68.0% 71.8% 72.5% 73.1% 71.4%
Operating Margin 13.5% 15.1% 28.8% 16.8% 19.2% 19.9% 14.6% 23.1% 12.7% 18.0% 22.5% 18.4% 31.1% 22.2% 24.1%
Pre-Tax Margin 6.8% 9.4% 25.0% 10.7% 13.7% 13.7% 7.4% 20.0% 5.7% 12.4% 16.5% 12.0% 26.4% 15.8% 18.4%
Net Margin 6.3% 16.2% 21.7% 8.8% 13.8% 11.8% 8.9% 34.6% 4.6% 16.4% 13.4% 9.8% 21.4% 12.8% 14.9%
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Two Centerpointe Drive, Suite 400  Lake Oswego, Oregon 97035  [phone]  [phone]  www.dadavidson.com
Copyright D.A. Davidson & Co., 2011. 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. James L.
Bellessa, Jr., CFA and Michael Bates, the research analysts 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.
We, James L. Bellessa, Jr., CFA and Michael Bates, attest that (i) all the views expressed in this research report accurately reflect our
personal views about the common stock of the subject company, and (ii) no part of our 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 9/30/11) Buy Hold Sell
Corresponding Institutional Research Ratings Buy Neutral Underperform
and Distribution 58% 39% 3%
Corresponding Individual Investor Group Ratings Outperform Market Perform Underperform
and Distribution 53% 47% 0%
Distribution of Combined Ratings 57% 40% 3%
Distribution of companies from whom D.A. Davidson & Co. has received compensation for investment banking services in last 12 mos.
Institutional Coverage 4% 3% 0%
Individual Investor Group Coverage 0% 6% 0%
Distribution of Combined Investment Banking 3% 3% 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., 2011. All rights reserved.
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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
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