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Hawaiian Electric (HE)
NYSE:HE
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Hawaiian Electric
(NYSE:HE)
54Neutral
Positive Factors
Credit Improvement
Management is confident on improving credit metrics, with expectations for FFO/Debt to return to approximately 15%-17% sooner than forecasted, and then climbing towards pre-wildfire levels.
Judicial Decisions
Shares of HE have risen approximately 20% on the story's improving backdrop following a favorable ruling by the Hawaii Supreme Court.
Negative Factors
Financial Transactions
The sale of a 90.1% stake in American Savings Bank was at a discount compared to its tangible book value, which negatively impacts the company's financial outlook.
Wildfire Risks
Potential shareholder contributions to a wildfire fund, likely settlement financing via additional equity, ongoing material underearning issues, and potential future wildfires present offsetting risks and limit upside.
Hawaiian Electric (HE) vs. S&P 500 (SPY)
Market Cap
$1.92B
Dividend YieldN/A
Average Volume (3M)2.86M
Price to Earnings (P/E)―
Beta (1Y)0.72
Revenue Growth-4.21%
EPS Growth-760.85%
CountryUS
Employees2,587
SectorUtilities
Sector Strength81
IndustryDiversified Utilities
Share Statistics
EPS (TTM)-12.00
Shares Outstanding172,494,260
10 Day Avg. Volume2,181,634
30 Day Avg. Volume2,859,228
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.59
Price to Cash Flow (P/CF)2.90
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$12.06Price Target Upside10.14% Upside
Rating ConsensusHold
Number of Analyst Covering4
Hawaiian Electric Business Overview & Revenue Model
Company DescriptionHawaiian Electric (HE) is the largest supplier of electricity in the state of Hawaii, serving over 95% of Hawaii's population across the islands of Oahu, Maui, Hawaii Island, Lanai, and Molokai. The company operates in the electric utility sector and is primarily engaged in the generation, transmission, and distribution of electricity. Hawaiian Electric is committed to increasing renewable energy sources and reducing dependency on imported oil, aligning with Hawaii's aggressive clean energy goals.
How the Company Makes MoneyHawaiian Electric makes money primarily through the sale of electricity to residential, commercial, and industrial customers across its service areas. The company's revenue model is based on regulated utility rates, which are approved by the Hawaii Public Utilities Commission. These rates are designed to cover the costs of providing electric service, including fuel, infrastructure maintenance, and operational expenses, while allowing for a reasonable rate of return on investment. Hawaiian Electric also generates income from investments in renewable energy projects, which are increasingly important as the company transitions to more sustainable energy sources. Additionally, partnerships with renewable energy developers and programs that encourage energy efficiency and conservation contribute to Hawaiian Electric's revenue streams.
Hawaiian Electric Financial Statement Overview
Summary
Hawaiian Electric faces financial challenges, with declining revenues and significant net losses impacting profitability and equity returns. Although cash flow generation remains positive, the balance sheet shows stress with declining equity, raising concerns over long-term financial sustainability.Income Statement
Hawaiian Electric's income statement shows a concerning decline in profitability, with a negative net income and EBIT in the most recent year, indicating significant operational challenges. The gross profit margin is essentially wiped out due to the negative EBIT, suggesting high operational costs or extraordinary expenses. The revenue has also decreased compared to the previous year, highlighting a downturn in top-line performance.32
Negative
Balance Sheet
The balance sheet of Hawaiian Electric reveals a moderate level of financial stability with a debt-to-equity ratio that remains manageable. However, the company's equity ratio indicates a reliance on equity financing. The decline in stockholders' equity is a concern, and the return on equity has turned negative due to the net losses, which poses a risk to long-term financial health.45
Neutral
Cash Flow
The cash flow statement indicates a strong operational cash flow, but the free cash flow growth is limited. The operating cash flow to net income ratio is unusually high due to the negative net income, suggesting that despite profitability issues, the company is still generating cash at an operational level. However, the free cash flow to net income is also skewed by the reported net losses.50
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.22B | 3.68B | 3.74B | 2.85B | 2.58B |
| Gross Profit | ||||
| -1.71B | 352.60M | 381.07M | 386.07M | 311.49M |
| EBIT | ||||
| -1.71B | 352.60M | 381.07M | 122.75M | 311.49M |
| EBITDA | ||||
| -1.39B | 636.23M | 660.08M | 648.13M | 564.44M |
| Net Income Common Stockholders | ||||
| -1.43B | 201.13M | 243.03M | 248.06M | 199.71M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 564.18M | 1.82B | 1.63B | 2.88B | 2.31B |
| Total Assets | ||||
| 2.36B | 17.24B | 16.28B | 15.82B | 15.00B |
| Total Debt | ||||
| 49.96M | 4.04B | 3.43B | 2.60B | 2.50B |
| Net Debt | ||||
| -514.22M | 3.36B | 3.23B | 2.30B | 2.16B |
| Total Liabilities | ||||
| 879.79M | 14.86B | 14.08B | 13.43B | 12.67B |
| Stockholders Equity | ||||
| 1.48B | 2.34B | 2.20B | 2.39B | 2.34B |
| Cash Flow | Free Cash Flow | |||
| 136.25M | 103.17M | 110.44M | 61.15M | 45.51M |
| Operating Cash Flow | ||||
| 465.73M | 551.47M | 454.48M | 375.67M | 429.41M |
| Investing Cash Flow | ||||
| -317.63M | -257.40M | -1.13B | -1.18B | -1.41B |
| Financing Cash Flow | ||||
| -72.03M | 195.57M | 567.67M | 756.40M | 1.12B |
Hawaiian Electric Technical Analysis
Neutral
10.95
Price Trends
10.35
Positive
10.16
Positive
10.80
Positive
Market Momentum
0.16
Positive
52.45
Neutral
42.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HE, the sentiment is Neutral. The current price of 10.95 is below the 20-day moving average (MA) of 10.98, above the 50-day MA of 10.35, and above the 200-day MA of 10.80, indicating a neutral trend. The MACD of 0.16 indicates Positive momentum. The RSI at 52.45 is Neutral, neither overbought nor oversold. The STOCH value of 42.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HE.
Hawaiian Electric Risk Analysis
Hawaiian Electric disclosed 27 risk factors in its most recent earnings report. Hawaiian Electric reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Hawaiian Electric Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $92.78B | 21.01 | 9.10% | 3.48% | 4.46% | 54.09% | |
74 Outperform | $38.40B | 20.76 | 8.44% | 3.07% | 4.23% | -27.02% | |
73 Outperform | $57.12B | 19.15 | 11.37% | 3.38% | 2.76% | 31.53% | |
70 Outperform | $22.40B | 17.57 | 8.83% | 5.44% | 7.72% | 6.49% | |
65 Neutral | $12.08B | 16.09 | 6.13% | 4.37% | 5.50% | -8.75% | |
64 Neutral | $37.29B | 14.75 | 9.10% | 0.32% | -0.04% | 6.80% | |
54 Neutral | $1.92B | ― | -68.17% | ― | -4.21% | -760.85% |
* Utilities Sector Average
Performance Comparison
HE
Hawaiian Electric
10.95
-0.15
-1.35%
AEP
American Electric Power
109.27
27.85
34.21%
ED
Consolidated Edison
110.59
23.30
26.69%
DUK
Duke Energy
121.97
29.48
31.87%
EIX
Edison International
58.92
-9.40
-13.76%
PCG
PG&E
17.18
0.68
4.12%
Hawaiian Electric Earnings Call Summary
Earnings Call Date: Feb 21, 2025 | % Change Since: 1.77% | Next Earnings Date: May 13, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements such as strong liquidity, progress in renewable energy, and advancements in the Maui wildfire settlement, but also noted substantial financial losses and challenges, including the impact of increased operational expenses.Highlights
Strong Liquidity Position
The company ended 2024 with the strongest liquidity position in its history, including a successful equity offering in September resulting in $558 million in net proceeds and a $250 million ATM program.
Renewable Energy Milestone
Achieved a 36% renewable portfolio standard in 2024, up from 33% in 2023, keeping Hawaiian Electric on track to reach a 40% RPS by 2030.
Maui Wildfire Settlement Progress
Final settlement agreements in the Maui wildfire tort litigation were signed, providing an accelerated path to recovery for those impacted by the fires and enhancing clarity for the company's future.
Supreme Court Decision
The Hawaii Supreme Court issued a unanimous decision in favor of Hawaiian Electric, aligning with the company's position on key questions from insurers' challenges to the settlement.
Lowlights
Financial Losses
The company generated a loss from continuing operations of $1.3 billion for the full year 2024, including wildfire settlement accruals of $1.9 billion pretax and other wildfire-related expenses.
American Savings Bank Sale Loss
The sale of 90.1% of American Savings Bank resulted in a net loss from discontinued operations totaling $103 million, including a net loss on the sale transaction of approximately $116 million.
Increased O&M Expenses
Utility core net income decreased due to higher O&M expenses, including increased wildfire prevention-related expenses such as vegetation management.
Company Guidance
During the fourth quarter 2024 Hawaiian Electric Industries, Inc. earnings call, significant guidance was provided on various metrics. The company highlighted its robust financial maneuvers, including a successful equity offering in September that raised $558 million in net proceeds, and the establishment of a $250 million ATM program and a $250 million accounts receivable-backed credit facility, culminating in the strongest liquidity position in the company’s history by the end of 2024. Hawaiian Electric also discussed the completion of the strategic sale of 90.1% of American Savings Bank for $405 million, enhancing their focus on core utility operations and reducing holding company debt. The utility achieved a 36% renewable portfolio standard in 2024, up from 33% in 2023, with a goal to reach 40% by 2030, while also reducing customer rates by 7%. The company invested approximately $120 million in 2024 for wildfire safety improvements and filed an updated wildfire safety strategy, estimating costs of about $450 million over three years. Financial results for 2024 included a loss from continuing operations of $1.3 billion, impacted by $1.9 billion in wildfire settlement accruals, with a core net income of $124 million excluding certain expenses. The call also addressed the favorable Hawaii Supreme Court decision regarding wildfire litigation, which is expected to aid in finalizing the settlement and restoring financial stability.Hawaiian Electric Corporate Events
Financial DisclosuresRegulatory Filings and Compliance
Hawaiian Electric Releases 2024 Statistical Supplement
Neutral
Mar 26, 2025
Hawaiian Electric Industries (HEI) has released its unaudited 2024 Statistical Supplement, which includes selected financial information for HEI, Hawaiian Electric, and American Savings Bank. The company will post this supplement on its website under the Investor Relations section, and encourages investors to monitor this section for additional disclosures. This release emphasizes the importance of HEI’s website as a primary source for investor information, alongside press releases, SEC filings, and public conference calls.
Private Placements and FinancingBusiness Operations and Strategy
Hawaiian Electric to Repurchase Debt with Share Sale Proceeds
Positive
Mar 5, 2025
On March 5, 2025, Hawaiian Electric Industries, Inc. announced its decision to use approximately $383.7 million from the sale of shares in American Savings Bank to repurchase a portion of its outstanding senior notes. This strategic move aims to strengthen the company’s financial position by reducing debt, potentially impacting its operations and market standing positively. The offer to purchase the notes is subject to specific conditions and must be accepted by holders by April 2, 2025.
Legal ProceedingsBusiness Operations and Strategy
Hawaiian Electric Faces Implications from Supreme Court Ruling
Negative
Feb 11, 2025
On February 11, 2025, Hawaiian Electric Industries, Inc. released a statement regarding the Hawaii Supreme Court’s decision related to insurance subrogation claims in the Maui wildfire tort litigation. This announcement could have significant implications for the company’s legal and financial responsibilities, marking a critical development in ongoing litigation matters that may affect stakeholders and the company’s operational strategies.
Business Operations and Strategy
Hawaiian Electric Releases Strategic Investor Presentation
Neutral
Jan 3, 2025
Hawaiian Electric Industries, Inc. has released an investor presentation intended for use with investors and analysts starting January 2, 2025. The presentation, which is available on the company’s website, is aimed at providing stakeholders with insights into the company’s strategic directions and operational updates.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.