Edison International (EIX): Valuation Check After Sharp Share Price Drop on Wildfire Liability Fears

Trending interest in Edison International (EIX) is flaring up after a sharp share price drop tied to fresh worries over wildfire liabilities from the Eaton Fire, even as analysts highlight the utility’s regulatory protections and defensive profile.

See our latest analysis for Edison International.

That drop sits awkwardly against a roughly 9% 3 month share price return and a 5 year total shareholder return of about 17%. This suggests long term holders still see value even as near term wildfire risk perceptions swing sentiment.

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With the stock trading at a steep discount to both analyst targets and some measures of intrinsic value, the real question now is whether Edison International is a mispriced defensive play or if the market is correctly discounting its future growth.

Most Popular Narrative: 13.8% Undervalued

With the most followed fair value estimate sitting above the recent 58.09 dollar close, the narrative frames Edison International as modestly mispriced rather than a broken story.

Policy driven increases in electrification particularly accelerated electric vehicle adoption and grid dependent building decarbonization are expected to drive sustained long term load growth within SCE's service area, supporting higher grid usage and long term revenue expansion.

Read the complete narrative.

Curious how steady revenue growth, thinner margins, and a richer future earnings multiple still add up to upside from here? The narrative spells out the math, including how long term capital spending and a specific discount rate combine to justify that higher fair value.

Result: Fair Value of $67.37 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that upside case hinges on wildfire liabilities and California’s evolving cost recovery rules not eroding margins or forcing more support from investors’ balance sheets.

Find out about the key risks to this Edison International narrative.

Build Your Own Edison International Narrative

If you see the story differently or want to stress test the numbers yourself, you can build a full narrative in minutes: Do it your way.

A great starting point for your Edison International research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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