The company’s financial performance is significantly impacted by wildfire risks, regulatory changes, and increasing operational costs, especially related to interest expenses and grid hardening initiatives
Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 24 Apr, 25 | EIX | Buy | USD 58.16 | USD 62.0 | USD 65.5 | 46 days | Closed |
8.37%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Edison International, through its subsidiaries, generates and distributes electric power. The company supplies electricity to approximately 50,000 square mile area of southern California to residential, commercial, industrial, public authorities, agricultural, and other sectors. It also provides decarbonization and energy solutions to commercial, institutional, and industrial customers in North America and Europe. The company's transmission facilities consist of lines ranging from 55 kV to 500 kV and approximately 80 transmission substations; and distribution system consists of approximately 38,000 circuit-miles of overhead lines; approximately 31,000 circuit-miles of underground lines; and 730 substations. Edison International was founded in 1886 and is headquartered in Rosemead, California.
The company’s long-term guidance predicts a 5-7% Core EPS growth, with expectations of increasing from $5.84 in 2025 to a range of $6.74 to $7.14 by 2028, highlighting strong future prospect
Edison International’s full-year core earnings increased to $1,900 million, or $4.93 per share, up from $1,825 million, or $4.76 per share in 2023, reflecting growth despite increased costs
Edison International’s parent and other operations reported a higher core loss per share in Q4 2024, primarily driven by increased interest expenses and the absence of gains from preferred stock repurchases that occurred in 2023
Fourth-quarter core EPS decreased to $1.05 per share in Q4 2024, down from $1.28 per share in Q4 2023, primarily due to higher operating and interest costs
The company’s financial performance is significantly impacted by wildfire risks, regulatory changes, and increasing operational costs, especially related to interest expenses and grid hardening initiatives
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 58.16 | 53.5 | 62.0 | 65.5 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Fourth-Quarter 2024 Financial Performance
Edison International reported a decrease in fourth-quarter net income for 2024, totaling $340 million, or $0.88 per share, compared to $378 million, or $0.99 per share in the same period last year. The company’s core earnings for Q4 2024 were $405 million, or $1.05 per share, lower than the core earnings of $490 million, or $1.28 per share, reported in Q4 2023. The decline in core earnings was primarily attributed to increased operational and maintenance expenses and higher interest costs. However, revenue growth from authorized increases under Southern California Edison’s (SCE) 2021 General Rate Case and a rise in the authorized rate of return provided some offset.
Full-Year 2024 Financial Results
For the full year, Edison International saw an increase in net income, which reached $1,284 million, or $3.33 per share, compared to $1,197 million, or $3.12 per share in 2023. The company’s core earnings also grew, totaling $1,900 million, or $4.93 per share, up from $1,825 million, or $4.76 per share in the prior year. SCE’s higher core earnings were mainly driven by the revenue increases authorized in its 2021 General Rate Case and the cost of capital adjustment mechanism, although these were partially offset by higher interest expenses.
Challenges and Higher Costs in Q4
Despite the increase in revenues, Edison International faced some challenges in the fourth quarter. The company’s parent and other operations reported a higher core loss per share, primarily due to increased interest expenses. This was compounded by one-time gains from preferred stock repurchases in 2023, which did not recur. These factors led to an overall weaker performance in the parent segment.
Wildfire Mitigation and Safety Investments
In response to the catastrophic impact of recent wildfires, Edison International underscored the importance of grid resiliency. Southern California Edison continues to invest heavily in hardening its grid systems to support community safety. The company has been actively implementing a comprehensive wildfire mitigation plan and working to reconstruct the affected areas, particularly in regions impacted by the Eaton and Palisades fires. Edison International remains committed to strengthening its infrastructure to better manage wildfire risks in the future.
Strategic Collaborations with Stakeholders
Edison International is also actively engaged in discussions with stakeholders, including other utilities, the Governor’s Office, and legislative leaders, to find solutions that will help strengthen the regulatory framework for utility safety and resilience. The company expressed confidence that key policymakers will take action to enhance the AB 1054 regulatory framework, which is aimed at bolstering the safety and stability of California's utilities.
2025 Earnings Guidance and Long-Term Outlook
Looking ahead, Edison International has revised its earnings guidance for 2025 to reflect the impact of the TKM settlement. The company has provided a revised core EPS guidance range of $5.94 to $6.34. Edison International remains confident in its long-term prospects, targeting a 5-7% growth in core EPS from $5.84 in 2025 to a range of $6.74 to $7.14 by 2028. This growth trajectory reflects the company’s continued efforts to manage costs and grow revenues while ensuring safety and infrastructure reliability.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to Edison International (NYSE: EIX) at the closing market price of USD 58.16, as on April 23, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Utilities Industry: Utilities - Regulated Electric
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| EIX Edison International |
-0.01 0.02% | 52.55 | 21.81 | 13.55 | 1.61 | 1.95 | 3.79 | 10.88 |
| NEE Nextera Energy Inc |
0.86 1.18% | 73.88 | 15.77 | 17.61 | 4.52 | 2.61 | 7.10 | 12.28 |
| SO Southern Company |
0.36 0.40% | 91.51 | 25.35 | 17.76 | 2.89 | 2.48 | 5.27 | 13.35 |
| DUK Duke Energy Corporation |
0.25 0.21% | 117.31 | 20.54 | 16.34 | 2.60 | 1.59 | 5.34 | 11.98 |
| AEP American Electric Power Co Inc |
0.60 0.58% | 103.86 | 19.17 | 16.18 | 2.58 | 1.91 | 4.83 | 12.39 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is April 23,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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