FirstEnergy Corp. (FE), headquartered in Akron, Ohio, generates, transmits, and distributes electricity as well as offers exploration, production, and distribution of natural gas. Valued at $23 billion by market cap, the company owns and operates power generation facilities, including coal-fired, nuclear, hydroelectric, wind, and solar power generating facilities, and provides energy management and other energy-related services. The electric utility giant is expected to announce its fiscal fourth-quarter earnings for 2024 on Thursday, Feb. 13.
Ahead of the event, analysts expect FE to report a profit of $0.71 per share on a diluted basis, up 14.5% from $0.62 per share in the year-ago quarter. The company beat or matched the consensus estimates in three of the last four quarters while missing the forecast on another occasion.
For the full year, analysts expect FE to report EPS of $2.67, up 4.3% from $2.56 in fiscal 2023. Its EPS is expected to rise 8.6% year over year to $2.90 in fiscal 2025.
FE stock has underperformed the S&P 500’s ($SPX) 26.5% gains over the past 52 weeks, with shares up 6.9% during this period. Similarly, it underperformed the Utilities Select Sector SPDR Fund’s (XLU) 27.7% gains over the same time frame.
FE’s underperformance stems from seasonal demand shifts, mild weather conditions decreasing power sales, regulatory pressures in Ohio, higher storm restoration costs, asset sale dilution, and reduced tax benefits. Additionally, regulatory uncertainties, such as delays in base rate request approval may limit the company's ability to recover service costs, affecting its performance.
On Oct. 29, FE shares closed down by 2% after reporting its Q3 results. Its adjusted EPS of $0.85 missed Wall Street expectations of $0.91. The company’s revenue was $3.7 billion, falling short of Wall Street forecasts of $4 billion. FE expects full-year adjusted EPS to be between $2.61 and $2.71.
Analysts’ consensus opinion on FE stock is moderately bullish, with a “Moderate Buy” rating overall. Out of 17 analysts covering the stock, seven advise a “Strong Buy” rating, two suggest a “Moderate Buy,” seven give a “Hold,” and one recommends a “Moderate Sell.” FE’s average analyst price target is $46.94, indicating a potential upside of 17.7% from the current levels.
