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Reasons to Add FirstEnergy (FE) to Your Portfolio Right Now
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FirstEnergy Corporation’s (FE - Free Report) continuous capital investments to maintain and increase resiliency enhance its performance. The modernization of the grid will help withstand severe weather conditions and ensure a constant supply of electricity even during challenging conditions.
The company currently carries a Zacks Rank #2 (Buy). Let’s look at the factors that are driving the stock.
Growth Projections
The Zacks Consensus Estimate for FE’s 2024 and 2025 earnings has increased 0.75% and 0.35%, respectively, in the last 60 days.
The company’s long-term (three to five years) earnings growth is pinned at 5.87%.
Surprise History & Dividend Details
FirstEnergy has a positive earnings surprise history. Its trailing four-quarter earnings surprise is 3.2%, on average.
The company’s board of directors approved a new dividend policy that increased the target payout ratio to 60-70% from 55-65% previously. Its current dividend yield is 4.4%, better than the industry average yield of 3.7%.
Return on Equity & Return on Asset
FirstEnergy’s current return on equity (ROE) is pinned at 12.5%, which is more than the industry average of 9.7%. ROE, a profitable measure, reflects how effectively a company is utilizing its shareholders’ funds in its operations to generate income.
FE’s current return on assets (ROA) is pinned at 3%, which is more than the industry average of 2.6%. ROA, another profitable measure, reflects how effectively a company is utilizing its assets in its operations to generate income.
Investments
FirstEnergy’s strategic investment will help serve its 6 million customers more efficiently. The company’s "Energize365" is a multi-year grid evolution platform that is focused on enhancing the customer experience while maintaining affordability.
With planned investments of $26 billion between 2024 and 2028, FE plans to install advanced equipment and technologies that will strengthen and modernize its transmission and distribution infrastructure. It also expects investments worth $4.3 billion in 2024. Strengthening the transmission and renewable generation assets will allow it to transmit electricity even during adverse weather conditions.
Price Performance
Shares of FirstEnergy have gained 4.1% in the past three months compared with the industry’s 2.6% growth.
Consolidated Edison has delivered an average earnings surprise of 5.9% in the last four quarters. The Zacks Consensus Estimate for earnings for 2024 and 2025 indicates year-over-year growth of 5.13% and 5.15% respectively.
CenterPoint Energy has delivered an average earnings surprise of 3.13% in the last four quarters. The company’s long-term (three to five years) earnings growth is pinned at 7%.
Fortis has delivered an average earnings surprise of 4.17% in the last four quarters. The Zacks Consensus Estimate for earnings for 2024 and 2025 indicates year-over-year growth of 2.19% and 2.66% respectively.
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Reasons to Add FirstEnergy (FE) to Your Portfolio Right Now
FirstEnergy Corporation’s (FE - Free Report) continuous capital investments to maintain and increase resiliency enhance its performance. The modernization of the grid will help withstand severe weather conditions and ensure a constant supply of electricity even during challenging conditions.
The company currently carries a Zacks Rank #2 (Buy). Let’s look at the factors that are driving the stock.
Growth Projections
The Zacks Consensus Estimate for FE’s 2024 and 2025 earnings has increased 0.75% and 0.35%, respectively, in the last 60 days.
The company’s long-term (three to five years) earnings growth is pinned at 5.87%.
Surprise History & Dividend Details
FirstEnergy has a positive earnings surprise history. Its trailing four-quarter earnings surprise is 3.2%, on average.
The company’s board of directors approved a new dividend policy that increased the target payout ratio to 60-70% from 55-65% previously. Its current dividend yield is 4.4%, better than the industry average yield of 3.7%.
Return on Equity & Return on Asset
FirstEnergy’s current return on equity (ROE) is pinned at 12.5%, which is more than the industry average of 9.7%. ROE, a profitable measure, reflects how effectively a company is utilizing its shareholders’ funds in its operations to generate income.
FE’s current return on assets (ROA) is pinned at 3%, which is more than the industry average of 2.6%. ROA, another profitable measure, reflects how effectively a company is utilizing its assets in its operations to generate income.
Investments
FirstEnergy’s strategic investment will help serve its 6 million customers more efficiently. The company’s "Energize365" is a multi-year grid evolution platform that is focused on enhancing the customer experience while maintaining affordability.
With planned investments of $26 billion between 2024 and 2028, FE plans to install advanced equipment and technologies that will strengthen and modernize its transmission and distribution infrastructure. It also expects investments worth $4.3 billion in 2024. Strengthening the transmission and renewable generation assets will allow it to transmit electricity even during adverse weather conditions.
Price Performance
Shares of FirstEnergy have gained 4.1% in the past three months compared with the industry’s 2.6% growth.
Image Source: Zacks Investment Research
Other Stocks to Consider
Other top-ranked stocks in the industry are Consolidated Edison, Inc. (ED - Free Report) , CenterPoint Energy (CNP - Free Report) , and Fortis Inc. (FTS - Free Report) . Each of these stocks currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Consolidated Edison has delivered an average earnings surprise of 5.9% in the last four quarters. The Zacks Consensus Estimate for earnings for 2024 and 2025 indicates year-over-year growth of 5.13% and 5.15% respectively.
CenterPoint Energy has delivered an average earnings surprise of 3.13% in the last four quarters. The company’s long-term (three to five years) earnings growth is pinned at 7%.
Fortis has delivered an average earnings surprise of 4.17% in the last four quarters. The Zacks Consensus Estimate for earnings for 2024 and 2025 indicates year-over-year growth of 2.19% and 2.66% respectively.