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Assessing Edison International (EIX) Valuation After Dividend Hike And Ongoing Wildfire Risk

Simply Wall St · 4d ago

Edison International (EIX) has drawn fresh attention after announcing a higher quarterly dividend, marking the 22nd straight year of payout growth, while analyst commentary continues to focus on the utility’s wildfire related risk exposure.

See our latest analysis for Edison International.

The higher dividend comes after a mixed year for Edison International, with the share price at US$58.46 after a 10.16% 90 day share price return but a 10.60% decline in 1 year total shareholder return. This suggests recent momentum has picked up even as wildfire risk and analyst caution remain in focus.

If income and stability are front of mind after this dividend news, it could be a good moment to compare Edison International with other healthcare stocks that balance defensiveness with long term growth stories.

With Edison International trading at US$58.46, carrying a 43% intrinsic discount figure and sitting below an average analyst price target, the real question is whether this represents genuine value or whether the market is already pricing in future growth.

Most Popular Narrative: 13% Undervalued

The most followed narrative puts Edison International’s fair value at US$67.37, compared with the last close of US$58.46, framing the current price as discounted.

Significant state and federal investment, along with policy momentum for decarbonization, will underwrite large-scale grid modernization and renewable energy integration projects, providing Edison International with stable, above-inflation capital expenditure opportunities and growing its regulated rate base, supporting earnings and rate base-driven revenue growth.

Read the complete narrative.

Curious how a regulated utility earns this kind of valuation gap? The narrative leans heavily on steady revenue growth, moderating margins and a richer future earnings multiple. The full breakdown shows exactly how those pieces fit together.

Result: Fair Value of $67.37 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, lingering wildfire liabilities and shifting California regulation around cost recovery and future wildfire funding could still derail that upside story if outcomes turn less favorable.

Find out about the key risks to this Edison International narrative.

Build Your Own Edison International Narrative

If you interpret the numbers differently or prefer to test your own assumptions, you can build a custom Edison International story in minutes with Do it your way.

A great starting point for your Edison International research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If Edison International is on your radar, do not stop there. Widen your watchlist with other ideas that target income, growth and sector themes.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.