DCF Studio

    EIX · NYQ · Utilities

    Edison International

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 1.04

    Market price

    USD 59.71

    Implied upside

    -98.3%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Wrong toolThis model values the shares at 1.7% of the market price. A gap that size is a modelling failure rather than a view - most often an unusable beta, a currency or units mismatch, or a cashflow base that does not represent the business. Read the figures below as diagnostics, not as a call.
    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.
    AdjustedCapital expenditure runs at 33.3% of revenue against depreciation of 16.1%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 1.04-98.3%
    Exit multiple
    USD -2.04-103.4%
    Market price
    USD 59.71

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    -0bn1bn2bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 19.0bnUSD 19.6bnUSD 20.2bnUSD 20.7bnUSD 21.3bnUSD 21.9bnUSD 22.5bnUSD 23.1bnUSD 23.7bnUSD 24.2bn+2.7%
    EBITUSD 3.3bnUSD 3.4bnUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.8bnUSD 3.9bnUSD 4.0bnUSD 4.1bnUSD 4.2bn+2.7%
    NOPATUSD 3.0bnUSD 3.1bnUSD 3.2bnUSD 3.3bnUSD 3.4bnUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.8bnUSD 3.9bn+2.7%
    Add depreciation & amortisationUSD 3.1bnUSD 3.2bnUSD 3.2bnUSD 3.3bnUSD 3.4bnUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.8bnUSD 3.9bn+2.7%
    Less capital expenditureUSD -6.3bnUSD -6.3bnUSD -6.2bnUSD -6.2bnUSD -6.1bnUSD -6.0bnUSD -5.9bnUSD -5.7bnUSD -5.6bnUSD -5.5bn-1.6%
    Capex, % of revenue33.3%32.1%30.9%29.7%28.5%27.3%26.1%24.9%23.7%22.5%-
    Less increase in working capitalUSD 3.4mUSD -6.6mUSD -6.6mUSD -6.7mUSD -6.7mUSD -6.8mUSD -6.8mUSD -6.8mUSD -6.9mUSD -6.9m-
    Free cashflow to firmUSD -222.0mUSD -4.2mUSD 237.0mUSD 491.9mUSD 760.7mUSD 1.0bnUSD 1.3bnUSD 1.7bnUSD 2.0bnUSD 2.3bn-
    Discount factor0.97010.91300.85930.80870.76110.71630.67410.63440.59710.5619-
    Present valueUSD -215.4mUSD -3.9mUSD 203.6mUSD 397.8mUSD 579.0mUSD 747.5mUSD 903.7mUSD 1.0bnUSD 1.2bnUSD 1.3bn-
    Present Value Of The ForecastUSD 6.1bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.699Reported 0.551, pulled toward 1.0 (Blume)
    Cost of equity7.85%Risk-free + beta x equity risk premium
    Cost of debt5.78%Risk-free + 89bp, the spread for a A- rating at 3.4x interest cover. Book interest / average debt was lower, at 3.9%.
    Market capitalisationUSD 23.0bn35.6% of capital
    Total debtUSD 41.5bn64.4% of capital, book value as a proxy
    Tax rate7.1%Effective, capped at statutory
    WACC6.25%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 1.04

    85% of EV

    Forecast FCFF, final year
    USD 2.3bn
    Capex at depreciation, working capital in reinvestment
    USD 3.9bn
    Less reinvestment at g/ROIC (40.0% of NOPAT)
    USD -1.5bn
    Capitalised
    USD 2.3bn
    ROIC (WACC floor)
    6.3%
    Terminal value, undiscounted
    USD 63.4bn
    Terminal value, discounted
    USD 35.6bn
    Enterprise value
    USD 41.8bn
    Less net debt
    USD 41.4bn
    Equity value
    USD 401.7m

    Exit at 7.6x EBITDA

    Value per shareUSD -2.04

    85% of EV

    Terminal value, undiscounted
    USD 61.3bn
    Terminal value, discounted
    USD 34.5bn
    Enterprise value
    USD 40.6bn
    Less net debt
    USD 41.4bn
    Equity value
    USD -787.7m

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.25%92.59100.54114.55141.91209.12
    5.25%32.6830.1327.5725.0122.45
    6.25%5.103.071.04-0.99-3.02
    7.25%-14.60-16.26-17.91-19.56-21.22
    8.25%-29.30-30.68-32.05-33.43-34.80

    Outlined: this model. Green text: above today's price of 59.71. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year3.9%2.3%6.9%
    EBIT margin27.1%17.2%24.1%
    Discount rate-6.3%4.8%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.