EIX changes
Pick any two versions below to diff them.
- Price
- $55.65 → $57.19(+2.8%)
- Discount
- 23% to 38% → 21% to 36%(−2.0 pts)
- Next earnings
- 2026-10-30 → 2026-10-29
- Next earnings is estimate
- Yes → No
- Thesis
- Edison trades at a discount because investors cannot measure its liability for the January 2025 Eaton Fire, and California did not pass the law that would limit that liability. SCE says that its equipment was likely associated with the ignition, and Edison says that it cannot yet estimate its total losses. On August 30, 2026, the final version of Senate Bill 492 left out the shield against insurer lawsuits and the cap on withdrawals from the state Wildfire Fund that the governor had proposed, and the bill did not pass. The stock fell 23% on August 31, 2026. For the gap to close, three things must happen. First, the Eaton Fire claims must settle at a cost that the Wildfire Fund and customer-funded insurance can cover, as the voluntary compensation program and the first trial show. Second, California must pass wildfire reform that limits utility liability and refills the Wildfire Fund before it ends in 2028. Third, SCE must keep its investment-grade ratings and grow core EPS 5% to 7% a year without new shares. The tests come in order: Q3 2026 results, expected at the end of on October 29, 2026, the claim deadline of the compensation program on November 30, 2026, the first Eaton Fire jury trial in January 2027, and the 2027 legislative session with a new governor. If reform passes in 2027, the gap can close over the next four to eight quarters. The main risk is a large Eaton Fire verdict or a new fire caused by SCE equipment before reform passes.
- Checkpoints
- Oct 3029, 2026 (estimate): Q3 2026 results: Eaton Fire losses and guidance. Pending. Watch: Core EPS guidance of $5.90 to $6.20 kept and no large new Eaton Fire charge pass; a cut to guidance, a plan to sell new shares or a large new loss estimate fails. Nov 30, 2026: Eaton Fire compensation program: claim deadline. Pending. Watch: Most eligible claimants settle through the program at costs inside the self-insurance and Wildfire Fund coverage passes; most claims staying in court fails. Jan 2027: First Eaton Fire jury trial. Pending. Watch: A verdict or settlements near the program's values pass; a large verdict that raises the expected total cost far above the Wildfire Fund coverage fails. 2027 (estimate): California wildfire reform in the 2027 legislative session. Pending. Watch: A law that limits utility liability or refills the Wildfire Fund before it ends in 2028 passes; no law, or a downgrade of SCE below investment grade, fails.
- Recent events
- 2026-10-13: The short seller Muddy Waters said that it is short Edison. It claims that SCE knew for about five years that its wildfire risk model did not handle high winds well, and that a court can find willful misconduct in the Eaton Fire. It estimates fire damages of at least $4 billion, and a liability of about $20 billion if a court finds willful misconduct. These are the short seller's claims, not findings. Edison has denied negligence or wrongdoing, and it says that it cooperates with the investigations into the cause of the fire. The stock fell more than 3% that day, Reuters reported. 2026-09-17: SCE said that its Wildfire Recovery Compensation Program for the Eaton Fire had nearly 4,800 claims. It had made more than 2,700 offers, worth nearly $950 million, and paid more than $500 million. The deadline to submit a claim is November 30, 2026. 2026-08-31: The stock fell 23%, its largest one-day drop in more than 25 years, after the California legislature removed the utility liability limits from Senate Bill 492. Mizuho cut its rating to Neutral and its price target to $70 from $86, and Wells Fargo cut its rating to Underweight. The bill did not pass before the session ended. 2026-08-30: SCE said that the amended Senate Bill 492 does not deliver durable wildfire reform. It said that it will work with the next governor and legislature on a full solution. 2026-07-30: Edison reported Q2 2026 results. GAAP EPS was $1.39, and core EPS was $1.54, against $0.97 a year earlier. It kept its 2026 core EPS guidance of $5.90 to $6.20 and its target of 5% to 7% core EPS growth a year from 2025 to 2030, with no new equity in its financing plan. 2026-07-03: Aaron Moss, the CFO of SCE, became CFO of Edison International. He replaced Maria Rigatti, who retired on September 1, 2026. 2026-04-30: Edison International agreed to sell $500 million of 5.00% senior notes due 2028. 2026-04-28: Edison reported Q1 2026 results. GAAP EPS was $1.38, and core EPS was $1.42. It kept its 2026 core EPS guidance of $5.90 to $6.20.