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Looking at FirstEnergy’s Price Targets and Analyst Views

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Jan. 12 2018, Updated 7:33 a.m. ET

FirstEnergy

According to Wall Street analysts’ consensus, FirstEnergy (FE) stock has a mean price target of $36.2, which indicates an implied gain of 19% over the next 12 months. It’s currently trading at $30.4.

Among the 16 analysts covering FirstEnergy on January 8, 2018, ten recommended “holds” on the stock, while five recommended “buys.” One analyst recommended a “strong buy” on the stock.

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Market performance

FirstEnergy was one of the laggards among the S&P 500 Utilities (XLU) last year. Competitive utilities’ less stable earnings influenced their stock price movements, which could have been one of the main reasons for their (IDU) cheaper valuations.

Valuation

FirstEnergy stock continues to trade at a large discount compared to its historical average as well as to the industry average. It’s currently trading at an EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiple of 8.2x compared to its five-year average valuation multiple of just below 10x. The industry average valuation is ~11x.

You can analyze the largest utility stocks by market cap in Market Realist’s An Investor’s Guide: A Look at the 10 Largest S&P 500 Utilities.

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