Mizuho lowers FirstEnergy stock price target on regulatory headwinds
Mizuho has reduced its price target for FirstEnergy Corp. (NYSE:FE) from $51 to $47, maintaining a Neutral rating. The firm cited political and regulatory headwinds, particularly in Pennsylvania and Maryland, as factors expected to depress the stock's valuation. FirstEnergy's stock is currently trading near its 52-week low of $42.67, though some analysts believe it may be overvalued relative to its estimated fair value.
The company benefits from diversification across various jurisdictions and offers a 4.13% dividend yield, with a 29-year streak of consecutive dividend payments. West Virginia has become a key focus for FirstEnergy, with supportive policies, substantial infrastructure investments, and opportunities for above-average rate base growth.
The proposed $1.2-gigawatt generation project further enhances the state's potential. Despite the regulatory pressures, Mizuho has kept its Neutral rating, and FirstEnergy reported better-than-expected earnings in its second quarter, meeting Wall Street's profit forecast while surpassing revenue expectations.
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