10 Worst Performing Utilities Stocks to Buy According to Analysts

2) Edison International (NYSE:EIX)

% Decline Over Past Year: ~22.4%

Average Upside Potential: ~47.2%

Number of Hedge Fund Holders: 38

Edison International (NYSE:EIX) is engaged in the generation and distribution of electric power. UBS analyst Gregg Orrill upgraded the company’s stock from “Neutral” to “Buy.” The firm believes that California’s $21 billion wildfire fund is sufficient enough to cover the Eaton fire. The analyst expects a positive shift in the calendar of events. The company, with the help of its subsidiary Southern California Edison (SCE), remains a key player in California’s electric power sector. Edison International (NYSE:EIX)’s growth strategy remains closely aligned with California’s clean energy transition and electrification goals.

The company remains well-placed to benefit from the expansion of EVs and electrification trends within SCE’s service territory. The EV infrastructure expansion and the overall rise in electricity demand because of electrification efforts can fuel substantial growth in Edison International (NYSE:EIX)’s rate base. This can result in increased revenues and earnings over the long term. Its strategic investments in grid modernization and advanced metering infrastructure continue to aid its ability to meet the growing electricity needs of California’s dynamic energy landscape.

ClearBridge Investments, an investment management company, released its Q3 2024 investor letter. Here is what the fund said:

“From a sector perspective, meanwhile, our utilities overweight was positive, with Edison International (NYSE:EIX) our top individual contributor. The company reached a tentative deal to recoup $1.7 billion of wildfire and mudslide expenses in California, bolstering its balance sheet, increasing earnings and demonstrating the favorable regulatory environment in California, benefiting both Edison as well as Sempra, our largest utility holding. Another rate-sensitive area — real estate — was the second-best sector performer as rate cuts boosted valuations in this area. Our REITs underweight, however, was a headwind during the period.”