Thu, Oct. 20, 5:59 PM
- PJM Interconnection, which operates the biggest power market in the U.S., will hold an auction in May 2017 to award contracts to suppliers, which could decide the fate of some nuclear power plants that have struggled to make money because of competition from cheaper gas-fired electric plants and renewables.
- A Bloomberg analysis says four of the nuclear plants submitting bids - FirstEnergy's (NYSE:FE) Davis-Besse in Ohio and Eaver Valley in Pennsylvania, as well as Exelon's (NYSE:EXC) Three Mile Island in Pennsylvania and Byron Nuclear Generating Station in Illinois - may not be able to supply power cheaply enough to make the cut, and could be forced to close if they fail to win contracts.
Thu, Oct. 13, 3:46 PM
- FirstEnergy (FE +0.7%) is upgraded to Overweight from Equal Weight with a $37 price target at Barclays after the Ohio Public Utility Commission granted FE $204M in rate relief for three years, a figure the company found disappointing.
- Barclays says the Ohio rate relief was above expectations, meaning equity needs are lower to achieve the 14%-14.5% FFO/debt required for investment grade; the firm also likes FE’s 4.5% dividend yield, which it believes is sustainable.
- Upcoming catalysts for FE include a likely Pennsylvania rate settlement followed by guidance at the Edison Electric conference on Nov. 6, the firm says.
Wed, Oct. 12, 6:21 PM
- FirstEnergy (NYSE:FE) says it is disappointed by today's decision by Ohio's Public Utilities Commission to approve a $204M/year rate increase for three years.
- FE says the charge will result in a $3 increase on monthly bills, or ~3%, for a typical residential customer using 750 kwh/month, which it says is "insufficient" to cover necessary and costly investments and that the decision "fails to recognize the significant challenges that threaten Ohio utilities' ability to effectively operate."
- With the new charge, FE expects total monthly bills for its residential customers will come in lower than a year ago.
Tue, Sep. 20, 3:03 PM
Tue, Aug. 30, 5:37 PM
Mon, Aug. 8, 3:27 PM
- FirstEnergy (FE +1.6%) iis flying higher as the company's stock rating is upgraded by two firms: Morgan Stanley hiked its rating to Overweight from Equal Weight and lifted its price target to $41 from $38, and BofA/Merrill Lynch upgraded FE to Buy from Neutral with a $40 target.
- Stanley says its upgrade was based on the stock’s YTD underperformance, as well as management’s indications of potential strategic activity at the generation business; the firm also notes that FE made various remarks in its Q2 earnings call that indicate the merchant generation assets are inconsistent with the company’s strategy.
- BofA's upgrade is based on its increased confidence in FE's move toward a more regulated business structure.
Thu, Jul. 28, 4:40 PM
Wed, Jul. 27, 5:35 PM
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Tue, Jul. 26, 11:44 AM
- FirstEnergy (FE -1.6%) is downgraded to Sell from Neutral with a $31 price target, cut from $36, at Goldman Sachs, which sees shares coming under pressure as FE's above-market, non-regulated hedges expire and the company faces competition.
- Goldman forecasts below consensus EPS estimates by ~6% for 2018, greater than expected headwinds for FE’s non-regulated segment as above-market hedges expire, and balance sheet and credit risk as debt/EBITDA metrics at the non-regulated business weaken given lower earnings power.
- The firm also expects FE to issue equity worth $1.2B, representing ~8% of the current market cap during 2016-19, amid significant financing needs.
Fri, Jul. 22, 12:58 PM
- FirstEnergy (FE +1.6%) says it will shut down or sell some of the operations at two of its coal-fired generation plants in Ohio.
- FE plans to either sell or deactivate its 136 MW Bay Shore Unit 1 in Oregon, Ohio, and retire four units of its W.H. Sammis Plant in Stratton, Ohio.
- FE had hoped to obtain some subsidies for its older coal-fired power plants from the state's Public Utilities Commission, but the FERC rejected the plan after environmental groups opposed; FE now says the plants are too small to compete in today’s market.
Tue, Jul. 19, 1:15 PM
Mon, Jun. 27, 7:27 PM
- One of the biggest Brexit beneficiaries is the utilities sector, as the Dow Jones Utility Average and the SPDR Utilities Select Sector ETF both surged to new record highs as Treasury yields tumble to multiyear lows.
- The implied annual dividend yield for the Dow utilities is 3.08% and 3.18% for the utilities ETF, more than double the 10-year Treasury yield.
- J.P. Morgan equity strategists said today that they believe bond yields "are not going anywhere but lower,” and thus remain overweight on the utilities sector.
- At least six Dow utilities components posted record closes: NEE +3.3%, EIX +2.5%, AWK +2.4%, ED +1.9%, AEP +1.8%, PCG +0.8%.
- Among other major utilities in today's trade: SO +1.9%, DUK +1.9%, SCG +1.6%, ETR +1.1%, D +1%, AEE +1%, XEL +0.9%, SRE +0.9%, PEG +0.7%, FE +0.7%, EXC +0.6%.
- ETFs: XLU, UTG, IDU, VPU, GUT, BUI, FUTY, RYU, UPW, FXU, PUI, SDP, PSCU
Tue, May 24, 5:58 PM
- NRG Energy (NYSE:NRG), Dynegy (NYSE:DYN) and FirstEnergy (NYSE:FE) are lower AH by -3%, -1.5% and -0.3% respectively following the results of PJM Interconnection's latest auction.
- PJM says its "second auction with stringent pay-for-performance standards attracted a significant amount of new resources at competitive prices to the PJM footprint," as it procured ~167.3K MW in the auction to ensure electricity capacity for the June 2019-May 2020 delivery year; the clearing price was $100/MW-day for the majority of the 13-state PJM region vs. the $164.77 rate set during last year's auction.
- Prices were lower than some analysts had expected and lower than last year's auction results due to market fundamentals of changes in supply and demand, PJM says.
Tue, May 3, 10:27 AM
- FirstEnergy (FE +1.2%) is higher after asking Ohio's Public Utilities Commission to consider modifications to its Electric Security Plan, In a move that appears to be a strategy to avoid federal review of the power purchase agreements that U.S. regulators demanded last week.
- FE's plan would eliminate the power purchase agreements between the utility's regulated local power delivery companies - Ohio Edison, the Illuminating Co. and Toledo Edison - and its unregulated FirstEnergy Solutions, which owns the power plants.
- In the modified plan, surcharges would be based on estimated power production costs FE included in the original proposal it filed with the PUC more than 18 months ago, meaning there would be no need for a FERC review, according to the Cleveland Plain Dealer.
Thu, Apr. 28, 10:33 AM
- FirstEnergy (FE -11.4%) and American Electric Power (AEP -2.5%) are sharply lower after the FERC decides to review income guarantee agreements, which means the deals are not valid unless the two companies apply for and receive federal approval.
- The federal ruling pre-empts the ruling by Ohio's public utilities commission, which had considered for nearly two years plans to raise rates to subsidize some older coal-fired and nuclear power plants before unanimously approving them last month.
- "The decision is a disappointing and unfortunate intrusion by FERC into Ohio’s ability to protect its retail customers from market volatility and plan for the state’s generation needs,” AEP says.
- Competing electric utility Dynegy (DYN +3.3%) praises the FERC decision, saying the proposals accepted by Ohio regulators were "exorbitantly priced."
- Now read FirstEnergy beats by $0.05 and American Electric Power misses by $0.03, misses on revenue
Thu, Apr. 28, 9:16 AM| Thu, Apr. 28, 9:16 AM