Edison International raised to Buy at Evercore ISI, preferring it to peers
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Edison International (NYSE:EIX) was upgraded to Outperform from Inline with a $68 price target at Evercore ISI on Monday, preferring it to peers PG&E (PCG) and Entergy (ETR) as "investors do not like all the uncertainties at these utilities and will prefer companies for which they feel they can better predict linear earnings, cash flow and dividend growth."
The three companies have outsized risks of recurring wildfires or hurricanes, and processes and/or mechanisms that have already taken place for them, Evercore said, while it views the wildfire events for Hawaiian Electric (HE) and Xcel Energy (XEL) as more isolated events.
Given that Edison (EIX), PG&E (PCG) and Entergy (ETR) have heightened risk to the rising severity of climate events, Evercore thinks these utilities have "continual uncertainty about costs incurred, balance sheet stability, customer bill increases, earnings quality, and the ability to finance strong dividend (and earnings) growth."
While the companies have regulation that has generally been supportive, Evercore thinks their stories all likely will remain rocky due to a continuation of these events in their regions.

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