D.A. Davidson & Co., the Great Falls, Mont.-based stock brokerage, has boosted its 2004 and 2005 earnings estimates for Avista Corp., based partly on the Spokane companys potential for greater electric and gas rate relief than projected earlier. Stronger anticipated results in Avistas energy-marketing and resource-management areas of business also were a factor in its revised estimates.


In a report released last month authored by analyst James L. Bellessa Jr., D.A. Davidson raised its 2004 per-share earnings estimate for Avista by 4 cents, to $1.14 a share, and its 2005 estimate by 10 cents a share, to $1.50 a share. The brokerage, however, maintained a neutral rating on Avistas shares.


In boosting its earnings estimates, it noted that Avista Utilities, a subsidiary of the company, in February filed a request in Idaho to increase its net electric rates by $18.9 million. The net increase of 11 percent includes a requested increase of $35.2 million, or 24 percent, in electric base retail rates, with a proposed reduction in the current power-cost adjustment surcharge. The utility also asked for a $4.8 million increase, equal to about 9 percent, in its natural gas rates in Idaho.


Davidson said its assuming that the percentage increases in rates granted this fall will be half of what has been requested.


It said its assuming a benefit to Avista later this year from better margins on future delivery of the output from a 2-year-old gas-turbine power plant at Rathdrum, Idaho, in which Avista is part owner, and at least one new customer for Avistas resource-management business.


Davidson also increased its risk-adjusted target price for Avista stock by $2 a share, to $18 a share from $16. It says its basing that partly on its higher earnings estimates and also on the value it now places on the companys business-process outsourcer, Avista Advantage.


For that reason, it says, with Avistas stock hovering at the time of the brokerages report at around $17.50, its maintaining its neutral rating.