Hawaiian Electric: Company Seeks Restructuring Advice; Fair Value Lowered, Uncertainty Up to Extreme
We are lowering our Hawaiian Electric HE fair value estimate to $13 per share from $17 as we continue to assess the impacts of the wildfires in the utility’s service territory.
We’ve increased our Morningstar Uncertainty Rating to Extreme, from Very High, to account for the wide range of possible outcomes from lawsuits filed against the company. The company has sought restructuring advice, according to news reports.
With Hawaiian’s small market cap and with approximately one third of the firm’s shares trading daily during the past week, we continue to expect significant daily stock price volatility.
We also increased our estimate for wildfire liabilities based on news reports from outlets such as The Wall Street Journal suggesting Hawaiian Electric’s equipment started the Maui wildfire. Our new, higher liability estimate led to our fair value estimate decrease.
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