North American Utilities 2Q26 Previews: EIX, PCG, & SRE

研报英文原文证据摘录

North American Utilities 2Q26 Previews: EIX, PCG, & SRE

Aidan C Kelly AC North America Equity Research

(1-212) 622-4912 15 July 2026 J P M O R G A N

aidan.x.kelly@jpmchase.com

Investment Thesis, Valuation and Risks

Edison International (Neutral; Price Target: $82.00)

Investment Thesis

We maintain our Neutral rating on EIX as we see stronger risk/reward profiles elsewhere

amid a pending investigation on ultimate prudency and heightened scrutiny of the

company’s operations during the 2025 Eaton Fire. California provides a comparatively

constructive ratemaking framework equipped with a four-year rate cycle, full decoupling,

forward-looking test years, and above-average ROEs, while AB 1054 and SB 254 provide

important financial protections around the wildfire framework. However, we see little

momentum out of continued execution against the company’s 5-7% EPS CAGR given the

current overhang relating to the wildfires. Although EIX’s current significant discount far

outstrips potential Eaton exposure up to the company’s ~$4bn reliability cap, we see

qualitative negatives in this potential volatility, broader headline risk, and uncertainty of

targeted stakeholder pushback that keep us on the sidelines for now.

Valuation

We establish our Dec 2027 price target of $82/share (vs prior Dec 2026 price target of $76/

share). Our valuation applies a discounted 13.4x P/E multiple to our 2028 EPS estimate. The

discount reflects continued wildfire risk and the potential for greater regulatory and

operational scrutiny after the Eaton Fire (which EIX carries probable cause language),

balanced against the company’s wildfire mitigation work. Our valuation framework

incorporates an assumed $4bn shareholder contribution under a broader wildfire fund