Hawaiian Electric (HE) AI Stock Analysis

• Market Cap: $1.74B
• Dividend Yield: N/A
• Average Volume (3M): 2.13M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.60
• Revenue Growth: -4.21%
• EPS Growth: -760.85%
• Country: US
• Employees: 2,587
• Sector: Utilities
• Sector Strength: 94
• Industry: Diversified Utilities
• EPS (TTM): -12.00
• Shares Outstanding: 172,494,260
• 10 Day Avg. Volume: 1,597,586
• 30 Day Avg. Volume: 2,129,892
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.59
• Price to Cash Flow (P/CF): 2.90
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 2.19
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: -2.23
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $12.13
• Price Target Upside: 18.81% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

Hawaiian Electric's overall stock score reflects significant financial challenges, including declining revenues and substantial net losses. While technical indicators and valuation metrics also pose concerns, the company's strong liquidity position and strategic moves highlighted in the earnings call offer a glimmer of hope for recovery.

Positive Factors

Court Ruling

Shares of HE have risen approximately 20% on the story's improving backdrop following a favorable ruling by the Hawaii Supreme Court.

Credit Improvement

Management is confident on improving credit metrics, with expectations for FFO/Debt to return to approximately 15%-17% sooner than forecasted, and then climbing towards pre-wildfire levels.

Financial Position

Improved balance sheet with proceeds from the American Savings Bank sale directed towards debt reduction.

Negative Factors

Financial Outlook

The sale of a 90.1% stake in American Savings Bank was at a discount compared to its tangible book value, which negatively impacts the company's financial outlook.

Legislative Challenges

Crucial legislation establishing a wildfire fund, securitization, and a liability cap remains a gating item, preventing a more constructive outlook as many questions linger.

Settlement Risks

Potential shareholder contributions to a wildfire fund, likely settlement financing via additional equity, ongoing material underearning issues, and potential future wildfires present offsetting risks and limit upside.

Hawaiian Electric Business Overview & Revenue Model

Company Description

Hawaiian Electric Industries, Inc., together with its subsidiaries, engages in the electric utility, banking, and renewable/sustainable infrastructure investment businesses in the state of Hawaii. It operates in three segments: Electric Utility, Bank, and Other. The Electric Utility segment engages in the production, purchase, transmission, distribution, and sale of electricity in the islands of Oahu, Hawaii, Maui, Lanai, and Molokai. Its renewable energy sources and potential sources include wind, solar, photovoltaic, geothermal, wave, hydroelectric, municipal waste, and other biofuels. This segment serves suburban communities, resorts, the United States armed forces installations, and agricultural operations. The Bank segment operates a community bank that offers banking and other financial services to consumers and businesses, including savings and checking accounts; and loans comprising residential and commercial real estate, residential mortgage, construction and development, multifamily residential and commercial real estate, consumer, and commercial loans. This segment operates 42 branches, including 29 branches in Oahu, 6 branches in Maui, 4 branches in Hawaii, 2 branches in Kauai, and 1 branch in Molokai. The Other segment invests in non-regulated renewable energy and sustainable infrastructure in the State of Hawaii. Hawaiian Electric Industries Inc. was incorporated in 1891 and is headquartered in Honolulu, Hawaii.

How the Company Makes Money

Hawaiian Electric makes money primarily through the sale of electricity to residential, commercial, and industrial customers across its service areas. The company's revenue model is based on regulated utility rates, which are approved by the Hawaii Public Utilities Commission. These rates are designed to cover the costs of providing electric service, including fuel, infrastructure maintenance, and operational expenses, while allowing for a reasonable rate of return on investment. Hawaiian Electric also generates income from investments in renewable energy projects, which are increasingly important as the company transitions to more sustainable energy sources. Additionally, partnerships with renewable energy developers and programs that encourage energy efficiency and conservation contribute to Hawaiian Electric's revenue streams.

Hawaiian Electric Financial Statement Overview

Summary

Hawaiian Electric faces financial challenges, with declining revenues and significant net losses impacting profitability and equity returns. Although cash flow generation remains positive, the balance sheet shows stress with declining equity, raising concerns over long-term financial sustainability.

Income Statement

Hawaiian Electric's income statement shows a concerning decline in profitability, with a negative net income and EBIT in the most recent year, indicating significant operational challenges. The gross profit margin is essentially wiped out due to the negative EBIT, suggesting high operational costs or extraordinary expenses. The revenue has also decreased compared to the previous year, highlighting a downturn in top-line performance.

Balance Sheet

The balance sheet of Hawaiian Electric reveals a moderate level of financial stability with a debt-to-equity ratio that remains manageable. However, the company's equity ratio indicates a reliance on equity financing. The decline in stockholders' equity is a concern, and the return on equity has turned negative due to the net losses, which poses a risk to long-term financial health.

Cash Flow

The cash flow statement indicates a strong operational cash flow, but the free cash flow growth is limited. The operating cash flow to net income ratio is unusually high due to the negative net income, suggesting that despite profitability issues, the company is still generating cash at an operational level. However, the free cash flow to net income is also skewed by the reported net losses.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.22B	3.68B	3.74B	2.85B	2.58B
	Gross Profit
-1.71B	352.60M	381.07M	386.07M	311.49M
	EBIT
-1.71B	352.60M	381.07M	122.75M	311.49M
	EBITDA
-1.39B	636.23M	660.08M	648.13M	564.44M
	Net Income Common Stockholders
-1.43B	201.13M	243.03M	248.06M	199.71M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
564.18M	1.82B	1.63B	2.88B	2.31B
	Total Assets
2.36B	17.24B	16.28B	15.82B	15.00B
	Total Debt
49.96M	4.04B	3.43B	2.60B	2.50B
	Net Debt
-514.22M	3.36B	3.23B	2.30B	2.16B
	Total Liabilities
879.79M	14.86B	14.08B	13.43B	12.67B
	Stockholders Equity
1.48B	2.34B	2.20B	2.39B	2.34B
Cash Flow		Free Cash Flow
136.25M	103.17M	110.44M	61.15M	45.51M
	Operating Cash Flow
465.73M	551.47M	454.48M	375.67M	429.41M
	Investing Cash Flow
-317.63M	-257.40M	-1.13B	-1.18B	-1.41B
	Financing Cash Flow
-72.03M	195.57M	567.67M	756.40M	1.12B

Hawaiian Electric Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 10.21
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HE, the sentiment is Negative. The current price of 10.21 is above the 20-day moving average (MA) of 10.20, below the 50-day MA of 10.62, and below the 200-day MA of 10.90, indicating a neutral trend. The MACD of -0.09 indicates Negative momentum. The RSI at 47.70 is Neutral, neither overbought nor oversold. The STOCH value of 50.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HE.

Hawaiian Electric Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OTTR	71 Outperform	$3.26B	10.86	19.39%	2.47%	-1.38%	2.28%
MGEE	68 Neutral	$3.28B	27.01	10.17%	1.98%	-1.95%	2.33%
NWE	68 Neutral	$3.61B	16.10	7.94%	4.48%	6.45%	13.95%
UTL	68 Neutral	$953.65M	20.08	9.40%	2.96%	-11.18%	3.64%
Sector *	63 Neutral	$8.57B	12.54	6.26%	4.38%	3.11%	-10.24%
AVA	56 Neutral	$3.32B	18.10	7.09%	4.66%	10.64%	2.28%
HE	47 Neutral	$1.74B	―	-68.17%	―	-4.21%	-760.85%

Hawaiian Electric Corporate Events

Hawaiian Electric Releases 2024 Statistical Supplement

Hawaiian Electric Industries (HEI) has released its unaudited 2024 Statistical Supplement, which includes selected financial information for HEI, Hawaiian Electric, and American Savings Bank. The company will post this supplement on its website under the Investor Relations section, and encourages investors to monitor this section for additional disclosures. This release emphasizes the importance of HEI’s website as a primary source for investor information, alongside press releases, SEC filings, and public conference calls.

Hawaiian Electric to Repurchase Debt with Share Sale Proceeds

On March 5, 2025, Hawaiian Electric Industries, Inc. announced its decision to use approximately $383.7 million from the sale of shares in American Savings Bank to repurchase a portion of its outstanding senior notes. This strategic move aims to strengthen the company’s financial position by reducing debt, potentially impacting its operations and market standing positively. The offer to purchase the notes is subject to specific conditions and must be accepted by holders by April 2, 2025.

Hawaiian Electric Faces Implications from Supreme Court Ruling

On February 11, 2025, Hawaiian Electric Industries, Inc. released a statement regarding the Hawaii Supreme Court’s decision related to insurance subrogation claims in the Maui wildfire tort litigation. This announcement could have significant implications for the company’s legal and financial responsibilities, marking a critical development in ongoing litigation matters that may affect stakeholders and the company’s operational strategies.