Edison International (EIX) Impacted by California Wildfires in Q1 2025
In their first quarter 2025 investor letter, ClearBridge Investments discussed the impact of Southern California wildfires on Edison International (EIX). The letter highlighted challenges and strategic decisions regarding their investment in EIX.
Wildfire Impact on Utility Stocks
ClearBridge noted that while the S&P 500 experienced a decline of -4.3% in Q1 2025, their utility holdings, including Edison International (EIX), were negatively affected by the tragic wildfires in Southern California. These wildfires resulted in billions of dollars in damages.
ClearBridge's Perspective on EIX
Despite concerns about future liabilities, ClearBridge remains confident in California's Wildfire Fund and protective legislation to mitigate long-term financial impacts. They believe that the market has overly discounted EIX's valuation, given its defensive characteristics and high-single-digit earnings growth potential.
EIX Stock Performance
On May 19, 2025, Edison International (EIX) shares closed at $58.00, with a market capitalization of $22.316 billion.
Investment Strategy
While hedge fund interest in EIX increased, ClearBridge favors AI stocks for potentially higher returns in a shorter timeframe.
