Barclays Maintains an 'Equalweight' on FirstEnergy (FE); Davis-Besse Restart on Track

November 17, 2011 2:35 PM EST
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Price: $30.30 -1.5%

Rating Summary:
    7 Buy, 14 Hold, 1 Sell

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Barclays maintains an 'Equalweight' on FirstEnergy Corp. (NYSE: FE) price target of $47.00.

Barclays analyst says, "On 11/16 FE reported an electrical fire at an auxiliary building of the Davis-Besse nuclear plant to the Nuclear Regulatory Commission. The fire was put out in minutes and was the result of a water leak. There was no impact to public health and safety or to the environment. The plant remains shut down."

"FE continues to target the end of November for restart of Davis-Besse. This event does not appear serious. We don't see a meaningful financial impact event if Davis-Besse's return is delayed into next year."

"FE screens as an attractive integrated utility with a 4.9% dividend yield and
positioned to benefit from an uplift in PJM capacity revenue in the May '12 auction. Our 2014 EPS estimate is $4.00 and we expect the May '12 auction to produce significantly higher results: "PJM Releases Sensitivity Analysis" (11/11/11). However, we believe there is regulatory risk in NJ as a result of the Rate Counsel's request and performance around Hurricane Irene which also produced hearings for the NJ utilities."

For an analyst ratings summary and ratings history on FirstEnergy Corp. click here. For more ratings news on FirstEnergy Corp. click here.

Shares of FirstEnergy Corp. closed at $44.76 yesterday.

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