Buff, esto es mucho fango... Hoy ha llegado a perder casi otro 40% en la apertura, tocando casi los 5 dólares. Ahora está en 6.
Según morningstar su fair value recalculado tras haber revisado la situación es de 11 dólares.
Os dejo el copy&paste del análisis después del anuncio de la bancarrota, el enlace no creo que funcione pues estoy con un trial de 14 días de una cuenta premium.
https://www.morningstar.com/stocks/xnys/pcg/quote.html_
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Cutting Our PG&E FVE, but Bankruptcy No Death Knell at This Point
Analyst Note | by Travis Miller Updated Jan 15, 2019
Our new fair value estimate for PG&E is $11 per share after considering possible bankruptcy scenarios. We think this is a unique circumstance where shareholders retain postbankruptcy equity value. We are reaffirming our no-moat and very high uncertainty ratings.
We think the most likely near-term scenario is a fourth-quarter 2018 accounting charge that cuts PG&E's book equity well below its allowed regulatory capital structure. PG&E would have to issue a large amount of equity to restore its required equity share to 52% of total capital. We think the cost to raise this equity would be prohibitively expensive with the stock trading at just 22% of book value.
PG&E's restricted capital market access likely pushed it toward plans for Chapter 11 bankruptcy. We have raised our cost of equity to 11% from 9% and our cost of debt to 8% from 6.5% in our discounted cash flow valuation. We also now assume shareholders are responsible for $15 billion of probability-adjusted 2017-18 wildfire liabilities.
There are three reasons we think PG&E shareholders will retain equity value through bankruptcy. First, regulators last week voted to create a framework for a so-called stress test that limits 2017 wildfire liabilities. Second, government officials have said they want a healthy investor-owned utility. This would require about a 50% equity layer, limiting the losses shareholders would suffer.
Third, PG&E's financially strong gas and electric transmission businesses must maintain an equity layer to ensure their access to capital markets. A breakup would probably preserve at least $5 billion of equity value in those two businesses for shareholders. Bondholders might be reluctant to support a breakup recapitalization. Wildfire liability securitization, which California Senate Bill 901 allows, would effectively recapitalize the company while protecting bondholders and preserving equity value.
Business Strategy and Outlook | by Travis Miller Updated Jan 15, 2019
Northern California wildfires, notably the ones in October 2017 and November 2018, have sent PG&E into bankruptcy for the second time in the past two decades. With substantial potential liabilities looming, PG&E will work through regulatory, legal, and political processes to determine winners and losers. PG&E remains solvent, and we think shareholders can exit bankruptcy with value, albeit much less than before the wildfires began.
PG&E has always faced public and regulatory scrutiny as the largest utility in California. It is regularly in the headlines, both good and bad. On the positive side, PG&E will play a key role in implementing the state's aggressive energy modernization and environmental policies, resulting in investment opportunities that top its peers.
However, shareholder losses--uncontrollable as well as self-inflicted--are a key concern. The 2017 and 2018 wildfires could leave shareholders with nothing in a worst-case scenario. Wildfire legislation passed in August 2018 could help preserve some equity value, but the state's inverse condemnation strict liability standard remains a risk. The wildfire losses are set to top the $3 billion of lost shareholder value related to fines, rate refunds, and unrecovered investment following the 2010 San Bruno gas pipeline explosion.
PG&E suspended its dividend in late 2017, and it won't come back anytime soon as the company goes through bankruptcy. The dividend cut came just one year after shareholders received their first dividend increase in six years, dating back to the San Bruno disaster.
On a normalized basis, California has a mostly constructive regulatory framework that supports industry-leading core earnings growth. Aside from wildfire impacts, we expect 6% annual earnings growth based on $6 billion of planned annual investment and constructive outcomes in the 2020-22 general rate case and other rate proceedings.
Beyond 2022, California's quest to modernize the grid, meet state energy policy goals, and address distributed generation offers a long runway of growth. Its 10.25% allowed return on equity, which is locked in through 2019, is among the highest in the country.
Economic Moat | by Travis Miller Updated Jan 15, 2019
We do not believe PG&E has an economic moat. Although regulated utilities' service territory monopolies and efficient scale dynamics remain, we do not have enough confidence that PG&E will maintain a sufficiently wide spread between its cost of capital and returns on capital for more than 10 years to justify a narrow moat rating.
California has progressive state regulation and attractive earned returns that typically would be the foundation of an economic moat for a regulated utility. But the San Bruno pipeline explosion in September 2010, allegations of gas pipeline mismanagement, and potential wildfire liabilities have sunk earned returns on capital. PG&E is often subject to more regulatory scrutiny than most other utilities and we expect that to continue through the bankruptcy process.
PG&E's relationship with regulators and, ultimately, customers appeared to be improving before the wildfires. Regulators approved nearly all of PG&E's planned electric generation and distribution investment in its 2017-19 general rate case, a highly constructive outcome.
PG&E for many years received no love from California regulators. The California Public Utilities Commission granted PG&E just 55% of its requested revenue increase in its 2014-16 general rate case and just half of its requested rate increases in its 2011-13 general rate case. We need more proof that PG&E can sustain regulatory and political goodwill before considering a narrow moat rating.
PG&E and the other California utilities are benefiting from allowed returns that are well above most other U.S. utilities' allowed returns and their ultralow market costs of capital. This has been a tailwind for earnings and returns but could turn if market conditions tighten.
Fair Value and Profit Drivers | by Travis Miller Updated Jan 15, 2019
Our new fair value estimate is $11 per share after considering several of the most likely bankruptcy scenarios. We think this is a unique circumstance where shareholders are more likely than not to retain postbankruptcy equity value.
We now assume shareholders are responsible for $15 billion of probability-adjusted 2017-18 wildfire liabilities or related fines and penalties. This is about 50% of potential worst-case scenarios that would lead to no residual equity value.
We also assume PG&E's cost of capital remains elevated, given the mid-January credit rating cuts and the sharp drop in the stock price. PG&E's substantial investment plans require access to capital markets at reasonable prices. We have raised our cost of equity to 11% from 9% and our cost of debt to 8% from 6.5% in our discounted cash flow valuation.
On a normalized basis excluding wildfire impacts, we forecast 6% annual average earnings growth at least through 2020. This would drive ongoing earnings per share over $5 by the end of the next general rate case cycle in 2022 if not for the substantial dilution that will occur through bankruptcy.
Our normalized growth forecast is primarily based on our estimate that 2018-20 capital spending will average $5.5 billion per year and rate base will grow 7% annually. Our earnings growth lags rate base growth because of new equity PG&E would need to issue to fund its investment plan absent wildfire liabilities. In a normalized postbankruptcy scenario, we forecast realized returns on equity would climb above 10%, just below PG&E's prebankruptcy allowed return. We assume PG&E is able to recover substantially all net costs of closing the Diablo Canyon nuclear plant if 2024-25 retirement plans go forward.
Risk and Uncertainty | by Travis Miller Updated Jan 15, 2019
PG&E's inability to access capital markets at reasonable prices has led the company into bankruptcy. Legal, regulatory, political, and financial unknowns have mounted because of the late 2017 and 2018 California wildfires. In mid-January, the stock price sank below its level upon emerging from its previous bankruptcy.
Before the fires, PG&E had put aside nearly all of its financial uncertainty related to gas pipeline penalties and was headed into 2018-19 with more strategic and financial clarity than it has had in many years following several key regulatory decisions. But it now faces wildfire liabilities that are almost certain to surpass the gas pipeline costs.
PG&E needs well-functioning and cost-effective capital markets to fund what we estimate will be $6 billion of annual investments in 2019-21, on a normalized basis. PG&E started conserving cash by suspending the dividend in late 2017. It later drew down the utility's $3 billion revolver in late 2018. We think liquidity is sufficient to make it through 2019, but management decided bankruptcy would speed the resolution process.
All of the California utilities face significant public policy and regulatory pressure to upgrade the state's energy infrastructure to accommodate more customer-focused energy management, distributed generation and renewable energy. This makes it critical that PG&E works closely with policymakers and regulators to ensure it has financial support for these investments.
The ongoing debate about how California's inverse condemnation strict liability standard affects utilities introduces legal risks that go beyond just the 2017 and 2018 wildfires.
Stewardship | by Travis Miller Updated Jan 15, 2019
We give PG&E a Standard stewardship rating. Operating in California will always present regulatory, legal, and political challenges for management.
Although PG&E's equipment undoubtedly was involved in the 2017-18 wildfires, it's still not clear whether this was a case of bad luck or negligence. Regardless, it has wiped out nearly all shareholder value as the company goes through bankruptcy. We think management did an excellent job achieving constructive wildfire legislation in August 2018, but the glaring omission of 2018 fire coverage has offset all of the positives.
Resignations by several executives in mid-January, including CEO Geisha Williams, will bring new faces to the negotiating table in bankruptcy. Management must work with politicians and regulators to address the state's inverse condemnation doctrine and minimize 2017 and 2018 wildfire liability costs. Any findings that the company had been negligent in its work to prevent wildfires will likely eliminate any residual equity value.
This could be similar to the aftermath of the 2010 San Bruno gas pipeline explosion, when fines and penalties related to gas pipeline system mismanagement inflicted more harm on shareholders than reparations for the accident itself.
Apart from the wildfires and the gas pipeline issues, management has been able to capitalize on the state's constructive regulation following the 2001 energy crisis to achieve core earned returns that exceeded those of most other U.S. utilities. California's public policies addressing renewable energy, grid modernization, electric vehicles, and other next-generation energy management offer huge growth opportunities. But management must maintain good regulatory relationships and execute on public policy objectives to realize the upside.
In March 2017, Williams succeeded Tony Earley as CEO. We think her promotion from president at PG&E's utility subsidiary signaled the board's confidence that PG&E had re-established a solid reputation with stakeholders, including regulators, politicians, customers, and investors before the late 2017 wildfires. But the political backlash following the fires effectively forced her out.
CFO Jason Wells also was an insider who took on his role in early 2016. Wells has been with PG&E since 2007 and replaced Kent Harvey, who retired after leading PG&E through the post-San Bruno recovery. Wells faces a challenge, given the company's need to finance some $6 billion of annual investment for the foreseeable future as well as any wildfire liabilities.
Earley was an outsider when he joined in August 2011 to lead PG&E through the post-San Bruno recovery. We thought this was a good move at the time since Earley offered a fresh face to reset both operations and regulatory relations following San Bruno.
We like that executives have a high share of at-risk compensation. However, we're a bit concerned that the financial benchmark of the short-term incentive program is based on earnings from operations, which exclude costs for fines, write-offs and other one-time costs that have had--and could continue to have--a significant impact on shareholder value. This excluded all San Bruno and gas pipeline costs and probably will exclude any wildfire costs, both of which have had a significant negative impact on shareholder value.
