IDANOTE050412.pdf

Disclosures and Analyst Certifications can be found in Appendix A.
NEW YORK, NY MELVILLE, NY BOSTON, MA PRINCETON, NJ MIAMI, FL BOCA RATON, FL

520 Madison Avenue y New York, New York 10022 y Telephone: [phone] 800-LAD-THAL

Member: NYSE, NYSE Amex, FINRA, all other principal exchanges and SIPC

IIDDAACCOORRPP ((IIDDAA))
1Q12 Financial Results – Reiterating BUY Rating
Highlights
• We are reiterating our BUY rating on IDA shares. Our price target of $44 (previously
$46 p/s) implies a 2012/2013/2014 P/E of 14.2x/13.6x/13.0x our EPS estimates of
$3.10/$3.23/$3.38.
• On May 3, 2012, IDA reported 1Q12 net income of $24.9m or $0.50 per diluted share
compared to net income of $29.7m or $0.60 per diluted share in 1Q11 and our estimate of $0.59 per diluted share. The main drivers behind the y-o-y changes include: rate and regulatory changes +$5.1m, changes in sales volumes -$2.8m, pension and payroll related expenses -$5.3m, purchased services and software maintenance expense -$2.5m, increased depreciation, property tax and other -$1.8m, change in earnings at Bridger Coal Company +$3.4m, increase in AFUDC +$3.0m, change in additional amortization of ADITC -$3.0m and income tax expense and other
net decreases (net of tax) -$0.9m.
• IDA affirmed their previous 2012 earnings guidance of $3.00-$3.15 p/s and assumes
the following: Langley Gulch power plant is commercially available as of July 1, 2012,
assumes an estimated use of additional ADITC of less than $5m in 2012, Idaho Power
O&M expense of $325m-$335m, 2012 capital expenditures total $230m-$240m, 2013-2014 capital expenditures total $490m-$500m (excludes potential transmission construction spend), Idaho Power Hydroelectric Generation 7.5-9.5m MWh and Non-Regulated Subsidiary Earnings and Holdco of $0m-$3m.
• At 11.7x our 2014 EPS estimate of $3.38, IDA trades at a 13% discount to regulated
utility peers (regulated utility peers defined as utilities with a majority of operations
regulated by the State/Federal). We believe the discount is unwarranted due to the
following: earnings visibility and a 9.5% ROE floor based on year-end shareholder
equity due to ADITC rate agreement through 2014 (less than $5m to be used in 2012,
$25m available for use), limited regulatory risk, “reliability-driven” $820m Boardman-to-
Hemingway transmission project (IDA to own 21.21%, COD 2016), expectations for attractive dividend growth (50-60% target payout over time, current dividend implies a 44% 2012 payout ratio). Given the previously mentioned positive fundamentals, we reiterate our BUY rating.
• Other highlights include: $150m of first mortgage bonds issued in April 2013 (10-yr at
2.95%, 30-yr at 4.3%) with proceeds to be used to redeem $100m first mortgage
bonds (4.75% coupon) and to fund capital budget, minimal external financing needed
for remainder of 2012, March 2012 equity of 52% (target equity ratio of 50%), Langley
Gulch on schedule for July 1, 2012 commercial operations (IPUC approval pending),
industrial customer contract renegotiated and 2012 margin impact mitigated, due to
seasonality of rates (price/volume) third quarter is most meaningful margin contributor,
the 300 mile 500-kv Boardman-Hemingway transmission line development progressing (January 2012 cost-sharing agreements reached, indentified in 2011 IRP as needed for reliability).

COMPANY & MARKET DATA
Price (May 3, 2012) $39.35
Price Target, Excl Dividends (YE12) $44.00
Prior Target $46.00
52 - Week Range $33.88-$42.89
Mkt. Capitalization (mill) $1,932
Enterprise Value (mill) $3,408
FD Shares Outstanding (mill) 49
Avg. Daily Trading Vol. (000) 218
Book Value per Share (1Q12A) $33.18
Dividend (FY12E) / Yield $1.32 3.4%
FY2011A FY2012E FY2013E
Revenue (mill) $1,121 $1,220 $1,251
1Q EPS $0.60 $0.50
2Q EPS $0.42
3Q EPS $2.16
4Q EPS $0.18
EPS $3.36 $3.10 $3.23
Prior EPS
Consensus EPS $3.08 $3.21
P/E 11.7x 12.7x 12.2x
EV/EBITDA 11.4x 9.0x 8.7x
P/FCF nm nm nm
ESTIMATES
Volum e in Millions
0.0
1.0
2.03.0
4.0
$20
$25
$30
$35
$40
$45
Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11

Brian J. Russo, CFA
646-432-6312 [e-mail]
Ira Reibeisen 212-409-2051
[e-mail]
Power and Utilities Sector
Company Update

May 4, 2012
BUY
Brian Russo 646.432.6312 IDACORP (IDA)

Ladenburg Thalmann & Co. Inc. PAGE - 2 -

APPENDIX A: IMPORTANT RESEARCH DISCLOSURES

ANALYST CERTIFICATION
I, Brian Russo, attest that the views expressed in this research report accurately reflect my personal views about the subject security
and issuer. Furthermore, no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or
views expressed in this research report.
The research analyst(s) primarily responsible for the preparation of this research report have received compensation based upon
various factors, including the firm’s total revenues, a portion of which is generated by investment banking activities.
COMPANY BACKGROUND
Headquartered in Boise, Idaho, IDACORP, Inc., (IDA) is a holding company formed in 1998 that is primarily engaged in the
generation, transmission, distribution, sale and purchase of energy. IDA serves over 466,000 retail customers across its 24,000sq
mile service territory in both Idaho and Oregon, and owns approximately 3,267MW of generating capacity. IDA’s principal operating
subsidiary is Idaho Power Company (IPC). The company’s unregulated utilities include IDACORP Financial (IFS) that invests in
affordable housing and real estate and Ida-West Energy Company (Ida-West) that operates small hydroelectric generation projects.

VALUATION METHODOLOGY
We value equities utilizing a multi-faceted approach which includes; sum-of-the-parts, net asset value, discounted cash flow, leading
P/E, and EV/EBITDA.
RISKS
On top of normal economic and market risk factors that impact most all equities, Idacorp (IDA) is uniquely at risk to:
Because of IPC’s predominantly hydroelectric generating base and heavy reliance on hydroelectric generation, which can be
adversely affected by weather, reduced hydroelectric generation can reduce revenues and increase costs.
Continuing declines in stream flows and over-appropriation of water in Idaho may reduce hydroelectric generation and revenues and
increase costs.
Load growth in IPC’s service territory due to customer growth and demand for energy exposes it to greater market and operational risk
as increased reliance on purchased power to meet load requirements could increase costs and reduce earnings and cash flows.
IPC’s reliance on coal and natural gas to fuel its generating facilities exposes it to risk of increased market prices, which could
increase costs and reduced earnings.
Changes in temperature and precipitation can reduce power sales and revenues.
Climate change could affect customer demand and hydroelectric generation and lead to restrictions on generation resources.
If Idaho Public Utility Commission (IPUC), the Oregon Public Utility Commission (OPUC) or the Federal Energy Regulatory
Commission (FERC) grant less rate recovery in rate case filings than IPC needs to cover the costs of providing services, financial
results could be adversely impacted and economic expansion may be limited.
Conditions that may be imposed in connection with hydroelectric license renewals may require large capital expenditures and reduce
earnings and cash flows.
The cost of complying with environmental regulations related to air quality, water quality, natural resources and health and safety can
increase capital expenditures and operating costs and reduce earnings and cash flows.
IDACORP and its subsidiaries are subject to costs and other effects of legal and regulatory proceedings, settlements, investigations
and claims, including those that have arisen out of the western energy situation.
IPC’s business is subject to substantial governmental regulation and may be adversely affected by increased costs resulting from, or
liability under, existing or future regulations or requirements.
Increased capital expenditures can significantly affect liquidity.
As a holding company, IDACORP does not have its own operating income and must rely on the upstream cash flows from its
subsidiaries to pay dividends and make debt payments.
A downgrade in IDA’s credit ratings could negatively affect the company’s ability to access capital and increase their cost of
borrowing.
Adverse results of income tax audits could reduce earnings and cash flows.
Employee workforce factors, including the loss or retirement of key personnel, availability of qualified personnel and an aging
workforce, could increase costs and reduce earnings.
Brian Russo 646.432.6312 IDACORP (IDA)

Ladenburg Thalmann & Co. Inc. PAGE - 3 -

STOCK RATING DEFINITIONS
Buy: The stock’s return is expected to exceed 12.5% over the next twelve months.
Neutral: The stock’s return is expected to be plus or minus 12.5% over the next twelve months.
Sell: The stock’s return is expected to be negative 12.5% or more over the next twelve months.

Investment Ratings are determined by the ranges described above at the time of initiation of coverage, a change in risk, or a change
in target price. At other times, the expected returns may fall outside of these ranges because of price movement and/or volatility. Such
interim deviations from specified ranges will be permitted but will become subject to review.

RATINGS DISPERSION AND BANKING RELATIONSHIPS (AS OF 4/30/12)
Buy: 75% (33% are banking clients)
Neutral: 24% (8% are banking clients)
Sell: 1% (0% are banking clients)

INVESTMENT RATING AND PRICE TARGET HISTORY

Brian Russo 646.432.6312 IDACORP (IDA)

Ladenburg Thalmann & Co. Inc. PAGE - 4 -

COMPANY SPECIFIC DISCLOSURES:
Ladenburg Thalmann & Co. Inc. does not make a market in subject company. Ladenburg Thalmann & Co. Inc. has neither had an
investment banking relationship with, nor received investment banking fees from the subject company in the past 12 months. Neither
the Analyst, nor members of the Analyst’s household own any securities issued by the subject Company.

GENERAL DISCLAIMERS
Information and opinions presented in this report have been obtained or derived from sources believed by Ladenburg Thalmann & Co.
Inc. to be reliable. The opinions, estimates and projections contained in this report are those of Ladenburg Thalmann as of the date of
this report and are subject to change without notice.

Ladenburg Thalmann & Co. Inc. accepts no liability for loss arising from the use of the material presented in this report, except that
this exclusion of liability does not apply to the extent that such liability arises under specific statutes or regulations applicable to
Ladenburg Thalmann & Co. Inc. This report is not to be relied upon in substitution for the exercise of independent judgment.
Ladenburg Thalmann & Co. Inc. may have issued, and may in the future issue, other reports that are inconsistent with, and reach
different conclusions from, the information presented in this report. Those reports reflect the different assumptions, views and
analytical methods of the analysts who prepared them and Ladenburg Thalmann & Co. Inc. is under no obligation to ensure that such
other reports are brought to the attention of any recipient of this report.

Some companies that Ladenburg Thalmann & Co. Inc. follows are emerging growth companies whose securities typically involve a
higher degree of risk and more volatility than the securities of more established companies. The securities discussed in Ladenburg
Thalmann & Co. Inc. research reports may not be suitable for some investors. Investors must make their own determination as to the
appropriateness of an investment in any securities referred to herein, based on their specific investment objectives, financial status
and risk tolerance.

Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty,
express or implied, is made regarding future performance. The price, value of and income from any of the securities mentioned in this
report can fall as well as rise. The value of securities is subject to exchange rate fluctuation that may have a positive or adverse effect
on the price or income of such securities. Investors in securities such as ADRs, the values of which are influenced by currency
volatility, effectively assume this risk. Securities recommended, offered or sold by Ladenburg Thalmann & Co. Inc. (1) are not insured
by the Federal Deposit Insurance Company; (2) are not deposits or other obligations of any insured depository institution; and (3) are
subject to investment risks, including the possible loss of some or all of principal invested. Indeed, in the case of some investments,
the potential losses may exceed the amount of initial investment and, in such circumstances; you may be required to pay more money
to support these losses.

The information and material presented in this report are provided to you for information purposes only and are not to be used or
considered as an offer or the solicitation of an offer to sell or to buy any securities mentioned herein. This publication is confidential for
the information of the addressee only and may not be reproduced in whole or in part, copies circulated, or disclosed to another party,
without the prior written consent of Ladenburg Thalmann & Co. Inc.
Member: NYSE, NYSE Amex, FINRA, all other principal exchanges and SIPC

Additional Information Available Upon Request
© 2012 - Ladenburg Thalmann & Co. Inc. All Rights Reserved.