Hawaiian Electric Set to Release Q4 Earnings
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy HE?
Source: seekingalpha
- Earnings Announcement: Hawaiian Electric is set to announce its Q4 earnings on February 27th after market close, with a consensus EPS estimate of $0.24, reflecting a 20% year-over-year increase, which could significantly impact the stock price.
- Historical Performance: Over the past two years, Hawaiian Electric has exceeded EPS estimates 25% of the time and has achieved a perfect record of beating revenue estimates, indicating a strong financial performance that may bolster investor confidence.
- Estimate Revision Trends: In the last three months, there have been no upward revisions to EPS estimates and one downward revision, suggesting a cautious market outlook regarding the company's future profitability, which could affect investor sentiment.
- Market Sentiment Shift: Jefferies has downgraded Hawaiian Electric to a “Sell” rating, while HE and OTTR show the highest short interest in the utilities sector, contrasting with BIP and ES, which have the lowest short interest, indicating mixed market sentiment towards the stock.
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Analyst Views on HE
Wall Street analysts forecast HE stock price to fall
2 Analyst Rating
0 Buy
2 Hold
0 Sell
Hold
Current: 15.780
Low
10.00
Averages
11.00
High
12.00
Current: 15.780
Low
10.00
Averages
11.00
High
12.00
About HE
Hawaiian Electric Industries, Inc. is a holding company that provides energy services. The Company’s subsidiaries are principally engaged in electric utility and non-regulated renewable/sustainable infrastructure businesses operating in the State of Hawaii. Its electric utility, Hawaiian Electric Company, Inc. (Hawaiian Electric), supplies power to approximately 95% of Hawaii’s population. The Company operates through the electric utility segment. Hawaiian Electric and its operating utility subsidiaries, Hawaii Electric Light Company, Inc. (Hawaii Electric Light) and Maui Electric Company, Limited (Maui Electric), are regulated electric utilities that provide essential electric service to approximately 95% of Hawaii’s population through the operation of five separate grids that serve communities on the islands of Oahu, Hawaii, Maui, Lanai and Molokai. Its subsidiary, Pacific Current, LLC, invests in non-regulated clean energy and sustainable infrastructure in the State of Hawaii.
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.
Hawaiian Electric Set to Release Q4 Earnings
- Earnings Announcement: Hawaiian Electric is set to announce its Q4 earnings on February 27th after market close, with a consensus EPS estimate of $0.24, reflecting a 20% year-over-year increase, which could significantly impact the stock price.
- Historical Performance: Over the past two years, Hawaiian Electric has exceeded EPS estimates 25% of the time and has achieved a perfect record of beating revenue estimates, indicating a strong financial performance that may bolster investor confidence.
- Estimate Revision Trends: In the last three months, there have been no upward revisions to EPS estimates and one downward revision, suggesting a cautious market outlook regarding the company's future profitability, which could affect investor sentiment.
- Market Sentiment Shift: Jefferies has downgraded Hawaiian Electric to a “Sell” rating, while HE and OTTR show the highest short interest in the utilities sector, contrasting with BIP and ES, which have the lowest short interest, indicating mixed market sentiment towards the stock.
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Analysis of JCP Investment Management's Activist Strategy
- Activist Investment Strategy: JCP Investment Management adopts an aggressive approach by acquiring underperforming small and mid-cap companies, pushing for governance and strategic changes, showcasing a stark contrast to traditional hedge fund styles that focus solely on low valuations without active involvement.
- Management Involvement: Founder James Pappas has held multiple board positions in public companies, actively participating in governance to drive strategic reviews and asset sales, demonstrating that he is not just an observer but a participant aiming to unlock value through internal influence.
- Industry Focus: JCP has developed a strong reputation in the consumer, retail, and restaurant sectors, where operational execution and capital allocation decisions significantly impact valuations, leading the firm to pursue activist investments that seek strategic alternatives and governance changes.
- Market Performance: Analysis of the firm's 13F filings over recent years indicates that owning JCP's top positions has outperformed the broader market, highlighting the effectiveness of its investment strategy and providing investors with insights into uncovering overlooked opportunities in a market dominated by passive flows.
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Analysis of Short Selling in Utilities Sector
- Concentration of Short Selling: Within the utilities sector, Hawaiian Electric Industries (HE) and Otter Tail (OTTR) have the highest short interests at 12.37% and 11.99%, respectively, indicating strong bearish sentiment that could impact their stock price stability.
- Divergent Ratings: Despite being rated Hold by Seeking Alpha's quant ratings, Hawaiian Electric is rated Sell by Wall Street analysts, reflecting a divergence in market sentiment that may lead to decreased investor confidence.
- Least Shorted Stocks: In contrast, Brookfield Infrastructure Partners (BIP) and Eversource Energy (ES) have short interests of only 0.22% and 1.48%, respectively, indicating relative stability in these companies, which may attract risk-averse investors.
- Market Risk Warning: A report warns that the largest U.S. electric grid expects a surge in generation outages due to the ongoing cold snap, posing long-term risks to grid reliability, which could further exacerbate short selling pressures on utility stocks.
See More
Hawaiian Electric Downgraded by Jefferies, Price Target Cut to $12.50
- Rating Downgrade: Jefferies analyst Julian Dumoulin-Smith downgraded Hawaiian Electric from buy to underperform, reflecting uncertainty about the company's future, which led to a 2.5% drop in stock price on Tuesday.
- Price Target Adjustment: The analyst cut the price target by $1 to $12.50, indicating a weakening market confidence in Hawaiian Electric, which may affect investor buying decisions.
- Market Uncertainty: The analyst highlighted that Hawaiian Electric faces uncertainties regarding legislative decisions and pricing standards, which diminishes its competitive edge compared to other utility stocks and could lead to further stock price pressure.
- Industry Pressure: With rising concerns about affordability, Hawaiian Electric may experience increased pricing pressure, reflecting challenges faced by the entire utility sector in the current economic environment.
See More
Analyst Downgrades Hawaiian Electric to Sell, Price Target Reduced to $12.50
- Rating Downgrade: Jefferies analyst Julian Dumoulin-Smith downgraded Hawaiian Electric from buy to sell, reflecting uncertainty about the company's future performance, which led to a 2.5% drop in stock price on Tuesday.
- Price Target Adjustment: The analyst reduced the price target for Hawaiian Electric by $1 to $12.50, indicating a weakening market confidence that may influence investor decisions.
- Legislative Risks: The analyst highlighted significant risks for Hawaiian Electric, including legislative impacts on its funding and pricing capabilities, which could place the company at a disadvantage in a competitive utility market.
- Market Pressure: With rising concerns about affordability in electricity pricing, Hawaiian Electric is not the only utility facing pressure, suggesting broader challenges across the industry regarding pricing strategies.
See More
Hawaiian Electric Downgraded to Underperform by Jefferies with $12.50 Price Target
- Rating Downgrade: Jefferies downgraded Hawaiian Electric from Hold to Underperform with a price target cut from $13.50 to $12.50, indicating a diminished market confidence in the stock's future performance amid unresolved issues.
- Valuation Reversion: Although Hawaiian Electric's stock has rebounded from a deep discount to near fair value, the analyst notes that the current valuation has priced in multiple unresolved key issues, reflecting an overly optimistic market outlook on future profitability.
- Lack of Fundamentals: The analyst emphasizes that despite the recent stock price increase, there have been no substantial fundamental changes, leading the market to misinterpret this volatility as a shift in fundamentals, which could mislead investors regarding future risks.
- Future Uncertainty: Ongoing uncertainties surrounding potential wildfire liabilities and the financing of the Maui wildfire litigation settlement obligations remain significant overhangs, posing threats to Hawaiian Electric's financial stability.
See More
Hawaiian Electric Set to Release Q4 Earnings
- Earnings Announcement: Hawaiian Electric is set to announce its Q4 earnings on February 27th after market close, with a consensus EPS estimate of $0.24, reflecting a 20% year-over-year increase, which could significantly impact the stock price.
- Historical Performance: Over the past two years, Hawaiian Electric has exceeded EPS estimates 25% of the time and has achieved a perfect record of beating revenue estimates, indicating a strong financial performance that may bolster investor confidence.
- Estimate Revision Trends: In the last three months, there have been no upward revisions to EPS estimates and one downward revision, suggesting a cautious market outlook regarding the company's future profitability, which could affect investor sentiment.
- Market Sentiment Shift: Jefferies has downgraded Hawaiian Electric to a “Sell” rating, while HE and OTTR show the highest short interest in the utilities sector, contrasting with BIP and ES, which have the lowest short interest, indicating mixed market sentiment towards the stock.
See More
Analysis of JCP Investment Management's Activist Strategy
- Activist Investment Strategy: JCP Investment Management adopts an aggressive approach by acquiring underperforming small and mid-cap companies, pushing for governance and strategic changes, showcasing a stark contrast to traditional hedge fund styles that focus solely on low valuations without active involvement.
- Management Involvement: Founder James Pappas has held multiple board positions in public companies, actively participating in governance to drive strategic reviews and asset sales, demonstrating that he is not just an observer but a participant aiming to unlock value through internal influence.
- Industry Focus: JCP has developed a strong reputation in the consumer, retail, and restaurant sectors, where operational execution and capital allocation decisions significantly impact valuations, leading the firm to pursue activist investments that seek strategic alternatives and governance changes.
- Market Performance: Analysis of the firm's 13F filings over recent years indicates that owning JCP's top positions has outperformed the broader market, highlighting the effectiveness of its investment strategy and providing investors with insights into uncovering overlooked opportunities in a market dominated by passive flows.
See More
Analysis of Short Selling in Utilities Sector
- Concentration of Short Selling: Within the utilities sector, Hawaiian Electric Industries (HE) and Otter Tail (OTTR) have the highest short interests at 12.37% and 11.99%, respectively, indicating strong bearish sentiment that could impact their stock price stability.
- Divergent Ratings: Despite being rated Hold by Seeking Alpha's quant ratings, Hawaiian Electric is rated Sell by Wall Street analysts, reflecting a divergence in market sentiment that may lead to decreased investor confidence.
- Least Shorted Stocks: In contrast, Brookfield Infrastructure Partners (BIP) and Eversource Energy (ES) have short interests of only 0.22% and 1.48%, respectively, indicating relative stability in these companies, which may attract risk-averse investors.
- Market Risk Warning: A report warns that the largest U.S. electric grid expects a surge in generation outages due to the ongoing cold snap, posing long-term risks to grid reliability, which could further exacerbate short selling pressures on utility stocks.
See More
Hawaiian Electric Downgraded by Jefferies, Price Target Cut to $12.50
- Rating Downgrade: Jefferies analyst Julian Dumoulin-Smith downgraded Hawaiian Electric from buy to underperform, reflecting uncertainty about the company's future, which led to a 2.5% drop in stock price on Tuesday.
- Price Target Adjustment: The analyst cut the price target by $1 to $12.50, indicating a weakening market confidence in Hawaiian Electric, which may affect investor buying decisions.
- Market Uncertainty: The analyst highlighted that Hawaiian Electric faces uncertainties regarding legislative decisions and pricing standards, which diminishes its competitive edge compared to other utility stocks and could lead to further stock price pressure.
- Industry Pressure: With rising concerns about affordability, Hawaiian Electric may experience increased pricing pressure, reflecting challenges faced by the entire utility sector in the current economic environment.
See More
Analyst Downgrades Hawaiian Electric to Sell, Price Target Reduced to $12.50
- Rating Downgrade: Jefferies analyst Julian Dumoulin-Smith downgraded Hawaiian Electric from buy to sell, reflecting uncertainty about the company's future performance, which led to a 2.5% drop in stock price on Tuesday.
- Price Target Adjustment: The analyst reduced the price target for Hawaiian Electric by $1 to $12.50, indicating a weakening market confidence that may influence investor decisions.
- Legislative Risks: The analyst highlighted significant risks for Hawaiian Electric, including legislative impacts on its funding and pricing capabilities, which could place the company at a disadvantage in a competitive utility market.
- Market Pressure: With rising concerns about affordability in electricity pricing, Hawaiian Electric is not the only utility facing pressure, suggesting broader challenges across the industry regarding pricing strategies.
See More
Hawaiian Electric Downgraded to Underperform by Jefferies with $12.50 Price Target
- Rating Downgrade: Jefferies downgraded Hawaiian Electric from Hold to Underperform with a price target cut from $13.50 to $12.50, indicating a diminished market confidence in the stock's future performance amid unresolved issues.
- Valuation Reversion: Although Hawaiian Electric's stock has rebounded from a deep discount to near fair value, the analyst notes that the current valuation has priced in multiple unresolved key issues, reflecting an overly optimistic market outlook on future profitability.
- Lack of Fundamentals: The analyst emphasizes that despite the recent stock price increase, there have been no substantial fundamental changes, leading the market to misinterpret this volatility as a shift in fundamentals, which could mislead investors regarding future risks.
- Future Uncertainty: Ongoing uncertainties surrounding potential wildfire liabilities and the financing of the Maui wildfire litigation settlement obligations remain significant overhangs, posing threats to Hawaiian Electric's financial stability.
See More
