Is FirstEnergy Stock Underperforming the Nasdaq?

Akron, Ohio-based FirstEnergy Corp. (FE) is a diversified energy company. It generates, transmits, and distributes electricity in the United States. Valued at nearly $23 billion by market cap, FirstEnergy operates through Regulated Distribution and Regulated Transmission segments.

Companies worth $10 billion or more are generally described as “large-cap stocks,” FirstEnergy fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the regulated electricity industry. It owns and operates coal-fired, nuclear, hydroelectric, wind, and solar power-generating facilities.

Despite its strengths, FirstEnergy has slipped 11.4% from its 52-week high of $44.97 achieved on Sept. 5. Furthermore, FE stock declined 8.8% over the past three months, significantly underperforming the Nasdaq Composite’s ($NASX) 14.1% gains during the same time frame.

FirstEnergy’s performance remained grim over the longer term as well. FE gained 8.7% on a YTD basis and 7.7% over the past 52 weeks, lagging behind NASX’s 34% gains in 2024 and 35.7% returns over the past year.

To confirm the overall uptrend and recent downturn, FE has mostly traded above its 200-day moving average since early March before falling below it in the past two weeks. Furthermore, the stock remained below its 50-day moving average since late October.

FirstEnergy’s stock prices dropped over 1.5% in the trading session after the release of its Q3 results on Oct. 29. The company has experienced a series of unforeseen challenges in 2024, and once again failed to meet Wall Street’s earnings and topline expectations. Its total revenues of $3.7 billion, missed analysts’ estimates by a substantial 6.4% but was still up 6.9% compared to the year-ago quarter. Meanwhile, its adjusted EPS declined 3.4% year-over-year to $0.85, which missed analysts’ estimates by 6.6%.

On a positive note, the company has showcased impressive cash flow generation capability and continued to make longer-term investments. Its aggregate capital investment for the past three quarters has surged by a staggering 20.7% year-over-year to $2.7 billion, demonstrating its approach towards growth and expansion.

FirstEnergy has substantially lagged behind its peer Entergy Corporation’s (ETR) 47.9% gains in 2024 and 48.4% returns over the past year.

Among the 17 analysts covering the FE stock, the consensus rating is a “Moderate Buy.” The mean price target of $47.38 suggests an 18.9% upside potential from current price levels.

On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from Barchart

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.