HE
Hawaiian Electric Industries, Inc.
$13.22
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 51.3% below fair value
You pay
$13.22
Bear
$23.74
Fair
$27.13
Bull
$30.52
Bear
$23.74
+79.5%
$1.94 × 14x P/E
Fair
$27.13
+105.2%
$1.94 × 16x P/E
Bull
$30.52
+130.9%
$1.94 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
6.8x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $11.75 from 13 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $27.13 per share.
Warnings
The company's reported profits differ from official accounting profits by 173%. Check what costs are being left out of the adjusted number.
The company pays out 201% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $11.75 (from 13 analysts). Our estimate is 164% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples