Is Profit Recovery and Litigation Progress Changing the Investment Case for Hawaiian Electric Industries (HE)?

• Hawaiian Electric Industries reported a return to profitability for the second quarter and six months ended June 30, 2025, with quarterly net income of US$26.09 million compared to a very large loss a year earlier, while sales and revenue were slightly lower than the previous year.
• Investor Murray Stahl significantly increased his stake in the company in the second quarter, coinciding with progress on the Maui Wildfire Tort Litigation settlement, government support for wildfire liability caps, divestitures of non-utility assets, and credit rating upgrades recognizing improved financial strength.
• We'll examine how Murray Stahl's stake increase and litigation progress could reshape Hawaiian Electric Industries' investment narrative moving forward.

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Hawaiian Electric Industries Investment Narrative Recap

To be a shareholder in Hawaiian Electric Industries today, you need confidence that the company can withstand the financial and legal aftershocks from the Maui wildfire litigation, while capitalizing on a more streamlined utility business and future rate-setting decisions. The recent swing back to profitability is encouraging, though the ultimate size and terms of the mandated wildfire settlement, a central short-term catalyst, remain in flux; so far, the news does not materially reduce this key uncertainty or liquidity risk.

One announcement tying into recent developments is the Hawaii State legislature passing bills supporting wildfire settlement funding and imposing liability caps for future wildfire events. While these measures address some investor concerns over unpredictable litigation exposure, the effectiveness and ultimate impact on Hawaiian Electric’s risk profile will become clearer closer to the court-approved settlement in early 2026.

Yet despite these positive signals, there is still a crucial detail investors should be aware of: if the eventual liability cap is set higher than expected or lacks strong "safe harbor" protections, then ...

Read the full narrative on Hawaiian Electric Industries (it's free!)

Hawaiian Electric Industries' forecast projects $3.7 billion in revenue and $140.2 million in earnings by 2028. This assumes a 5.4% annual revenue growth and a $1.44 billion increase in earnings from the current -$1.3 billion loss.

Uncover how Hawaiian Electric Industries' forecasts yield a $11.50 fair value, in line with its current price.

Exploring Other Perspectives

Simply Wall St Community members have shared three fair value estimates for HEI, ranging from US$11.50 to US$6,060.76. While the wildfire settlement looms large in the short term, these broad perspectives show just how differently investors view future outcomes, explore other viewpoints to make an informed decision.

Explore 3 other fair value estimates on Hawaiian Electric Industries - why the stock might be a potential multi-bagger!

Build Your Own Hawaiian Electric Industries Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Hawaiian Electric Industries research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Hawaiian Electric Industries research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Hawaiian Electric Industries' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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