Here's Why Edison International Could Be a Smart Buy at This Moment

Edison International EIX is benefiting from the rising demand for clean electricity in its service region. The company has been making systematic investments to strengthen and expand its infrastructure to meet the rising demand from data centers. Given its strong growth and better future expansion plan, EIX makes for a solid investment option in the Zacks Utility-Electric Power industry.

Let us focus on the reasons that make this Zacks Rank #2 (Buy) stock a strong investment pick at the moment.

EIX’s Growth Outlook & Surprise History

The Zacks Consensus Estimate for 2025 earnings per share (EPS) has increased 0.33% to $6.10 in the past 60 days. 

The Zacks Consensus Estimate for 2025 revenues is pegged at $18.46 billion, which indicates growth of 4.90% from the 2024 reported figure.

EIX’s long-term (three to five years) earnings growth rate is 10.93%.

EIX’s earnings beat estimates in three of the trailing four quarters and missed the same in one, resulting in an average surprise of 7.25%.

EIX’s Capital Return Program

EIX has been increasing shareholder value by steadily paying dividends. Currently, the company’s quarterly dividend is 82.75 cents per share, resulting in an annualized dividend of $3.31. EIX’s current dividend yield is 5.76%, better than the Zacks S&P 500 composite's average of 1.12%.

EIX’s Capital Investment

Edison International follows a systematic capital investment strategy that focuses on its infrastructure development and provides safe and resilient electricity, which will help boost customer reliability. As part of this strategy, SCE recorded capital expenditures of $5.7 billion in 2024 and projects investments of $28-$29 billion for the 2025-2028 period, and 97% of this projected spending is allocated to the transmission and distribution grid and generation capacity.

EIX’s Return on Equity

Return on Equity (ROE) indicates how efficiently a company is utilizing shareholders’ funds to generate returns. At present, EIX’s ROE is 13.62%, higher than the industry average of 9.95%.

EIX’s Solvency Ratio

Edison International’s times interest earned ratio (TIE) at the end of the third quarter of 2025 was 3.2. The TIE ratio is a key solvency metric that indicates how effectively a company can meet its long-term debt obligations, showing the extent to which its operating earnings are sufficient to cover interest payments.

EIX’s Stock Price Performance

Over the past three months, EIX’s shares have risen 6.9% but lagged behind the industry’s growth of 7%.

Other Stocks to Consider

A few other top-ranked stocks from the same sector are Ameren Corporation AEE, FirstEnergy Corp. FE and American States Water Company AWR, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AEE’s long-term earnings growth rate is 8.52%. The Zacks Consensus Estimate for 2025 EPS is pegged at $4.99, which suggests year-over-year growth of 7.78%.

FE’s long-term earnings growth rate is 6.46%. The Zacks Consensus Estimate for 2025 EPS is pegged at $2.54, which implies a year-over-year decline of 3.42%.

AWR’s long-term earnings growth rate is 5.65%. The Zacks Consensus Estimate for 2025 EPS is pegged at $3.32, which suggests year-over-year growth of 4.73%.

 

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This article originally published on Zacks Investment Research (zacks.com).

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