Hawaiian Electric Industries surged Friday, following an eight-day losing streak.
The stock (ticker: HE) has faced significant pressure since last week, plummeting by 17% on Thursday. Investors have been concerned by the emergence of class-action lawsuits against the company in the wake of destructive wildfires that ravaged Hawaii.
In a Friday filing, the utility provider stated its intent to remain financially strong and rebuild with Hawaii and not to restructure the company. The stock climbed nearly 7% to $12.87 on Friday. It’s on pace for the largest percent increase in nearly 3 years.
Apart from an apparent positive perception of this statement, another contributing factor might be that Hawaiian Electric has already absorbed significant losses, as evident from prior declines.
The stock trades at 5.6 times its next 12-months earnings, below its five-year low of 6.2 times earnings, suggesting the market may have factored in potential losses from litigation.
Still, investors should beware the volatility in the stock—as clouds of uncertainty dissipate, Hawaiian Electric shares could move either way.
Source: https://www.barrons.com/livecoverage/stock-market-today-081823/card/hawaiian-electric-stock-surges-in-premarket-trading-here-s-one-reason-why–B0cG7ZdAJkqSEhwIoPJf?siteid=yhoof2&yptr=yahoo