FirstEnergy Upgraded to Outperform with $50 Target Amid Growth Prospects
Written by Emily J. Thompson, Senior Investment Analyst
Source: seekingalpha
- Rating Upgrade: Wolfe Research upgraded FirstEnergy from Peer Perform to Outperform with a $50 price target, citing the stock's discount to regulated peers and an anticipated rebound heading into 2026.
- Capex Opportunities: Analyst Steve Fleishman highlighted that opportunities in FERC transmission and West Virginia generation could drive rate base growth above 10%, with earnings growth projected at the upper end of the 6%-8% CAGR, requiring only 30% of incremental capex.
- Credit Metrics Improvement: FirstEnergy's credit metrics and ratings are now aligned with peers, indicating a successful rebuilding of credibility after last year's disappointing earnings, which positions the company for above-average growth.
- Regulatory Risk Mitigation: With the conclusion of last year's HB6 fine, the regulatory overhang in Ohio is expected to be lifted, and the successful legislative session earlier this year has averted potential risks, creating a favorable environment for future growth.
Analyst Views on FE
Wall Street analysts forecast FE stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for FE is 49.25 USD with a low forecast of 46.00 USD and a high forecast of 54.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
10 Analyst Rating
4 Buy
6 Hold
0 Sell
Moderate Buy
Current: 46.770
Low
46.00
Averages
49.25
High
54.00
Current: 46.770
Low
46.00
Averages
49.25
High
54.00
About FE
FirstEnergy Corp. and its subsidiaries are involved in the transmission, distribution, and generation of electricity through its segments: Distribution, Integrated and Stand-Alone Transmission. The Distribution Segment, which consists of the Ohio Companies and FirstEnergy Pennsylvania Electric Company (FE PA), distributes electricity in Ohio and Pennsylvania. The Integrated segment includes the distribution and transmission operations under Jersey Central Power & Light Company (JCP&L), Monongahela Power Company (MP) and The Potomac Edison Company (PE), as well as MP's regulated generation operations. The segment distributes electricity in New Jersey, West Virginia and Maryland, provides transmission infrastructure, and operates 3,604 MWs of regulated net maximum generation capacity. The Stand-Alone Transmission segment consists of its ownership in FET and KATCo, which includes transmission infrastructure owned and operated by the Transmission Companies and used to transmit electricity.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
