Update shared on19 Sep 2025
Fair value Decreased 0.35%PG&E’s consensus price target saw a slight downward revision to $20.39 as, despite legislative progress reducing near-term regulatory risks, ongoing wildfire liability uncertainties and affordability issues continue to temper investor sentiment.
Analyst Commentary
- Improved legislative outlook with the passage and strengthening of wildfire fund-related bills has reduced near-term regulatory uncertainties and relieved concerns about shareholder funding requirements.
- Delays in implementing a permanent wildfire fund solution and ongoing affordability concerns in California maintain some investor caution and weigh on sentiment.
- Bearish analysts cite a slow resolution to tail risks related to wildfire liabilities, contributing to downward pressure on price targets.
- Bullish analysts see a favorable risk/reward profile, supported by the replenished wildfire fund and PG&E’s significant valuation discount to sector peers.
- Positive sector-wide catalysts, such as the underappreciated long-term value of nuclear and positive guidance for renewables and residential solar, support a constructive view despite lingering risks.
What's in the News
- California lawmakers approved an agreement to increase the state’s wildfire utility fund by $18B, with half funded by ratepayers and half by utility shareholders, to help offset rising wildfire-related liabilities for utilities like PG&E and Edison International (Bloomberg, 2025-09-10).
- The fund increase nearly doubles existing commitments, following a proposal by Governor Gavin Newsom after major wildfires in Los Angeles County and addresses depletion risks in the utilities’ wildfire fund (Bloomberg, 2025-07-30).
- PG&E lowered its full-year 2025 GAAP earnings guidance to $1.26–$1.32 per share from the previous range of $1.29–$1.35 per share (Key Developments, 2025-07-31).
- The enhanced wildfire fund aims to increase financial stability for California utilities amid heightened wildfire damage risks, potentially reducing uncertainty for investors (Bloomberg, 2025-09-10; 2025-07-30).
- There were no relevant recent client announcements or workforce development activities specifically attributable to PG&E during the period (Key Developments, 2025-08-11).
Valuation Changes
Summary of Valuation Changes for PG&E
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $20.46 to $20.39.
- The Future P/E for PG&E remained effectively unchanged, moving only marginally from 15.00x to 14.94x.
- The Consensus Revenue Growth forecasts for PG&E remained effectively unchanged, at 4.1% per annum.
Disclaimer
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