Valued at a market cap of $19.4 billion, Edison International (EIX) generates and distributes electric power and is based in Rosemead, California. The company supplies and delivers through its electrical infrastructure and serves residential, commercial, industrial, public authorities, agricultural, and other sectors.
Companies worth $10 billion or more are typically classified as “large-cap stocks,” and EIX fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the utilities - regulated electric industry. The company stands out for its reliable, diversified energy generation and distribution across California, utilizing a robust mix of natural gas, hydro, nuclear, and renewable sources. It benefits from a strong market position and brand reputation, serving over 15 million customers and commanding significant share in the power transmission sector. Its strategic focus on innovation and digital transformation enhances operational efficiency, resilience, and customer service.
This utility company has dipped 43.3% from its 52-week high of $88.77, reached on Sep. 4, 2024. Shares of EIX have declined 9.2% over the past three months, underperforming the Utilities Select Sector SPDR Fund’s (XLU) 6.1% uptick during the same time frame.
In the longer term, EIX has fallen 31.5% over the past 52 weeks, considerably lagging behind XLU’s 17.1% return over the same time frame. Moreover, on a YTD basis, shares of EIX are down 36.9%, compared to XLU’s 8.2% rise.
To confirm its bearish trend, EIX has been trading below its 200-day moving average since early January, and has remained below its 50-day moving average since early December, 2024, with slight fluctuations.
On Apr. 29, EIX released its mixed Q1 earnings results, and shares of the company plunged 8.9% in the following trading session. Its operating revenue declined 6.5% year-over-year to $3.8 billion, missing the consensus estimate by 7.7%. However, on the upside, its total operating expenses decreased by 56.2% from the same period last year, primarily due to wildfire-related recoveries recorded in this quarter, leading to a significant rise in its operating income, totaling $2.1 billion. Moreover, EIX’s adjusted EPS came in at $1.37, up 21.2% from the year-ago quarter and 13.2% above Wall Street estimates.
EIX’s underperformance looks pronounced when compared to its rival, The Southern Company (SO), which gained 15.2% over the past 52 weeks and 9.8% on a YTD basis.
Despite EIX’s recent underperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of "Moderate Buy” from the 17 analysts covering it, and the mean price target of $68.97 suggests a 36.9% premium to its current price levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
