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FirstEnergy +4% as analyst says merchant exit risks priced in

Published 06/26/2017, 12:41 PM
© Reuters.  FirstEnergy +4% as analyst says merchant exit risks priced in
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  • FirstEnergy (FE +4%) is the biggest gainer in the S&P 500 Utilities Index as Wolfe Research upgrades shares to Peer Perform from Underperform with a $32 price target, raised from $30.
  • Wolfe predicts modest upside in the shares with FE’s exit from the merchant power business seen as "bumpy, but downside risks are mostly priced in," and the firm's previous negative stance is no longer warranted since FE is at a "significantly depressed valuation and the company will ultimately have no merchant exposure."
  • Several near-term catalysts could add clarity to FE's merchant exit, including the Ohio legislative session and the DOE grid study, Wolfe says.
  • Now read: FirstEnergy: Avoid


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