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Consolidated Edison - AI Stock Analysis
Analysis generated November 7, 2024
Consolidated Edison, Inc. (NYSE: ED) is one of the largest investor-owned energy-delivery companies in the United States. The company provides a wide range of energy-related products and services through its subsidiaries, which primarily include Consolidated Edison Company of New York, Inc. (CECONY) and Orange and Rockland Utilities, Inc. (O&R). CECONY's regulated electric, gas, and steam businesses provide electricity to approximately 3.5 million customers, gas to approximately 1.1 million customers, and steam to approximately 1,600 buildings in Manhattan. The primary business focus includes electric power transmission and distribution, gas distribution, and steam business operations.
Fundamental Analysis
For the last quarter, Consolidated Edison reported revenue of $3.22 billion, a decrease of 24.77% compared to the prior quarter. This indicates some level of concern regarding the company's short-term revenue generation. However, when viewed year-over-year, the revenue has increased by 9.38%, suggesting positive long-term growth.
Net income for the last quarter was $202 million, reflecting a sharp decrease of 71.94% from the previous quarter. This is alarming as it indicates a significant drop in profitability. Compared to the same quarter last year, net income decreased by 10.62%, pointing to ongoing challenges in maintaining earnings.
EBITDA for the last quarter stood at $992 million, which is down by 42.73% from the prior quarter. Despite this quarterly decline, year-over-year EBITDA shows a slight increase of 0.51%, attributing to steady operational performance over the longer term.
The Price-to-Earnings (P/E) ratio is 19.27, which falls within a normal range for utility companies. This neither signals the stock as undervalued nor overvalued based on its earnings.
Technical Analysis
Today's stock price is $97.93, down by 3.17% compared to a month ago, which may be concerning for short-term traders. However, compared to a year ago, the stock price has increased by 14.39%, indicating a positive long-term trend. Despite the long-term growth, the current trend is bearish.
The Simple Moving Average (SMA10) is 100.32, lower than the previous SMA10 of 101.01. This suggests potential downward pressure in price movement.
The Relative Strength Index (RSI) stands at 70.8, indicating that the stock is in an overbought condition—a bearish signal that suggests the stock might experience a price correction.
Alternative Data Analysis
Consolidated Edison currently has 67 open positions as per data from popular job boards, marking a decline of 22% over the last few months. This could indicate that the company is looking to cut costs or improve margins, which is not a positive signal for growth.
The business outlook among employees at Consolidated Edison is neutral, indicating neither high optimism nor deep pessimism within the workforce.
Customer acquisition seems worrisome as webpage visitors are estimated at 42,000, down by 29% in the last few months. This could indicate a loss of customer interest or engagement.
On the customer engagement front, the company has seen a moderate increase in social media presence. The Instagram following is up by 5% to 16,000 followers, indicating increased interest. On the other hand, Twitter followers remain stagnant at 43,000, suggesting no significant change in engagement.
The AI score from AltIndex for Consolidated Edison is 56, which signals a hold recommendation based on a composite of fundamental, technical, and alternative data analysis.
Conclusion & Recommendation
In conclusion, Consolidated Edison presents a mixed bag of signals. The fundamental analysis indicates stagnating income and profitability, with year-over-year revenue and EBITDA increases providing some positivity. The technical analysis reflects short-term downward pressure and potential overvaluation, with longer-term price performance being positive.
Alternative data suggests potential cost-cutting measures, alongside mixed signals in customer acquisition and engagement metrics. Given the AI score of 56, a neutral business outlook from employees, and the recent trends, we recommend holding the stock. Investors should monitor upcoming earnings reports and industry trends for better clarity regarding the company's future performance.
Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.
