With a market cap of $22.6 billion, Edison International (EIX) engages in the generation and distribution of electric power. Founded in 1886, the Rosemead, California-based company supplies and delivers energy through its electrical infrastructure to an approximately 50,000 square-mile area of southern California.
Companies valued at more than $10 billion or more are generally considered “large-cap stocks”, and EIX fits this criterion perfectly. As a leading supplier of energy services, the company benefits from a large customer base consisting of residential, commercial, industrial, public authorities, agricultural, and other sectors.
However, the stock has fallen 34.1% from its 52-week high of $88.77, recorded on Sept. 4, last year. Shares of EIX have declined 24.9% over the past three months, underperforming the Utilities Select Sector SPDR Fund’s (XLU) 4.9% rally in the same time frame.
The stock’s performance looks bleak in the long run. Over the past six months, EIX shares declined 30.5%, underperforming XLU’s 1.2% gain. Moreover, shares of EIX have declined 15.8% over the past 52 weeks, compared to XLU’s 23.8% rally in the same time frame.
EIX has been trading below its 200-day moving average since early-January but has moved above its 50-day moving average since mid-March.
EIX’s stock declined 2.4% following its Q4 earnings release on Feb. 27. The company reported a 7.7% increase in its operating revenue for the full fiscal year, which amounted to $17.6 billion. Its EPS came in at $1.05, which failed to meet the Wall Street estimates by 2.8%, thanks to higher operation and maintenance expenses and higher interest expenses.
However, in the competitive utility sector, key rival The Southern Company (SO) is in the lead, with its stock surging marginally over the past six months and 27.6% over the past 52 weeks.
Nevertheless, analysts are reasonably optimistic about the stock's prospects. The stock has a consensus rating of “Moderate Buy” from the 18 analysts covering it, and the mean price target of $71.32 represents an upside of 21.9% from the current market prices.
