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The report highlights the anticipation of improvements in the sector as interest rates decline. Edison International is recognized for its strong position due to a favorable regulatory environment, a robust balance sheet, and a substantial residential customer base in suburban Southern California.
Moreover, the company’s leadership in renewable energy is noted, with its complete elimination of coal usage and significant generation of electricity from nuclear, solar, wind, and hydropower sources.
Despite past challenges, including legal issues and high costs associated with wildfire damage in California, Edison International has reached a settlement with state regulators over fires in 2018. The company is still addressing remaining wildfire claims and the potential recovery of these claim costs. If regulatory rate recovery is approved, significant earnings growth is expected for Edison International in 2024 and 2025.
The firm’s analysis suggests that Edison International is favorably valued when compared to its peers, taking into account price-to-earnings (P/E), price/sales, and PEG multiples. Moreover, the company offers a dividend yield of approximately 4.5%, which is higher than the average among its peers.
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