FirstEnergy (FE) stock is currently trading at an EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) valuation of 8.4x. FirstEnergy’s five-year valuation average is around 9.0x. So FE stock appears to be trading at a discounted valuation to its historical average.
In comparison, the largest competitive utility, Exelon Corporation (EXC), is currently trading at an EV-to-EBITDA valuation close to 8x. Its five-year historical average comes in around 7x. So Exelon stock seems to be trading at a premium compared to its historical average.
Peer Public Service Enterprise Group (PEG) stock looks expensive compared to peers. It’s trading at a valuation multiple of 11.2x.
The chart above compares stock price movements for FirstEnergy along with broader utilities (XLU) and broader markets. FirstEnergy has rallied almost 8% in the last year while Exelon has gained 6%. Broader utilities have lost almost 3%.