PG&E Corporation (PCG), headquartered in Oakland, California, is a leading provider of energy services in the U.S. With a market cap of $57 billion, PG&E plays a crucial role in delivering electricity and natural gas to millions of customers across Northern and Central California. PG&E invests in renewable energy and innovative technologies and is committed to sustainability and environmental responsibility.
Companies valued at $10 billion or more are generally considered "large-caps," and PG&E Corporation fits this criterion perfectly, signifying its substantial size, stability, and influence in the utility sector. The company benefits from a large customer base and the stability of regulated utility operations, ensuring consistent demand and predictable revenue.
PCG shares are trading 4.8% below their 52-week high of $20.65, which they hit on Sep. 5. PCG has seen a 6.6% gain over the last three months, underperforming the Utilities Select Sector SPDR Fund’s (XLU) 8.8% returns during the same period.
In the long term, PCG surged 9% on a YTD basis and has climbed 15.9% over the past year. In comparison, the XLU is up 21.7% in 2024 and 21.9% over the past year.
Despite the underwhelming price action, PCG has been trading above its 200-day moving average since mid-April and has been trading over its 50-day moving average since early August, indicating a recent bullish price trend.
PG&E's price performance over the past year has been weighed down by high interest rates and regulatory pressures affecting customer bills. Adding to the grim price momentum, PCG shares closed down more than 1% after the company reported its Q2 earnings results on Jul. 25. Its adjusted EPS of $0.31 surpassed Wall Street expectations of $0.30. The company’s revenue was $5.99 billion, beating Wall forecasts of $5.83 billion.
Edison International (EIX), a key industry competitor, has surpassed PCG, achieving only an 18.4% gain on a YTD basis and 21.2% over the past year, in contrast to PCG's stronger performance.
Analysts are optimistic about PCG's prospects despite its recent underperformance compared to the broader utilities sector. The stock has a consensus rating of "Strong Buy" from 14 analysts in coverage. The mean price target of $21.73 reflects a 10.6% premium over current price levels.
On the date of publication, Kritika Sarmah 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.
