10 Worst Performing Utility Stocks in 2024

4. Hawaiian Electric Industries (NYSE:HE)  

YTD Performance as of October 15: -28.82%  

Market Cap as of October 15: $1.79 Billion  

Number of Hedge Fund Investors: 21

Hawaiian Electric Industries (NYSE:HE) is the largest supplier of electricity in Hawaii, serving 95% of the state’s residents. The company is actively working toward transitioning its energy grid to rely more on renewable resources, such as solar and wind, to reduce its carbon footprint and align with the state’s renewable energy goals.

On September 25, Hawaiian Electric Industries (NYSE:HE) announced that it had successfully closed an offering of newly issued shares of its common stock, raising approximately $558 million in net proceeds. The offering, which was priced at $9.25 per share, is a significant step towards pre-funding, which is an expected contribution to the Maui wildfire litigation settlement. As announced earlier, Hawaiian Electric Industries’ (NYSE:HE) total payment obligation under the proposed global settlement is $1.91 billion, to be paid in four equal annual installments. The company’s first settlement payment of approximately $478 million is expected to be due no sooner than mid-2025.

Hawaii’s lack of preparedness and response to wildfires is a major concern. The state has not implemented measures such as power shut-offs during heat waves and windy periods, and its vegetative management program is underfunded and under-addressed. The Fire Research Safety Institute report on Hawaii urged the implementation of these measures, as well as the undergrounding of power lines in high-risk areas.

Hawaiian Electric Industries (NYSE:HE) is offering equity to address its financial obligations related to the settlement. By securing this financing ahead of schedule, the company is demonstrating its ability to deliver on its commitments and make progress towards resolving the going concern assessment disclosed in August 2023. The settlement, which is still in the final stages of negotiation, is expected to be signed and finalized soon, pending judicial review and approval. Once the settlement is finalized, Hawaiian Electric Industries (NYSE:HE) will have a clear path forward to resolve its obligations and move forward with its business operations.