Xcel Energy (XEL) could move higher as investor concerns about wildfire risk appear overly discounted, alongside strong earnings growth, possible upside to its spending plan, supportive regulatory outcomes and room for valuation improvement, UBS Securities said in a note Monday.

Xcel is expected to deliver one of the strongest earnings per share growth rates in the utility group, at more than 9%, and also has room for additional growth from power generation and transmission projects, including added capacity in Colorado and demand tied to a large Google data center in its service area.

Investor concerns have centered on wildfire conditions in Colorado and Texas, but the market is discounting that risk too heavily based on the company's limited liability history so far, the investment firm said.

Xcel stands out for earnings growth while needing a more manageable level of equity funding than many peers, which UBS sees as another support for the stock.

UBS maintained its buy rating and raised the price target to $91 from $89, adding that it expects Xcel to trade closer to the utility group's historical average valuation as the company executes its growth plan and reduces investor concerns.

Price: 81.49, Change: +0.41, Percent Change: +0.51