FE

Utilities

FirstEnergy

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Market Data

Financials

XBRL · SEC EDGAR

2007–2025(19yr)

Revenue

Net Income

Free CF

Metric	FY 2007	FY 2008	FY 2009	FY 2010	FY 2011	FY 2012	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017	FY 2018	FY 2019	FY 2020	FY 2021	FY 2022	FY 2023	FY 2024	FY 2025Latest	YoY
Revenue	$12.8B	$13.6B	$13.0B	$13.3B	$16.1B	$15.3B	$14.9B	$15.0B	$15.0B	$14.6B	$14.0B	$11.3B	$11.0B	$10.8B	$11.1B	$12.5B	$12.9B	$13.5B	$15.1B	+12.0%
Operating Income	$2.8B	$2.8B	$1.9B	$1.8B	$1.7B	$2.2B	$1.6B	$1.1B	$2.3B	-$8.3B	$172.0M	$2.5B	$2.5B	$2.2B	$1.7B	$1.9B	$2.3B	$2.4B	$2.2B	-7.1%
Operating Margin	22.0%	20.2%	14.5%	13.5%	10.5%	14.3%	10.8%	7.1%	15.3%	-56.7%	1.2%	22.2%	22.7%	20.0%	15.5%	15.3%	17.6%	17.6%	14.6%	-3.0pp
Net Income	$1.3B	$1.3B	$1.0B	$784.0M	$885.0M	$770.0M	$392.0M	$299.0M	$578.0M	-$6.2B	-$1.7B	$1.3B	$912.0M	$1.1B	$1.3B	$406.0M	$1.1B	$978.0M	$1.0B	+4.3%
Net Margin	10.2%	9.8%	7.8%	5.9%	5.5%	5.0%	2.6%	2.0%	3.8%	-42.4%	-12.3%	12.0%	8.3%	10.0%	11.5%	3.3%	8.6%	7.3%	6.8%	-0.5pp
Free Cash Flow	$66.0M	-$664.0M	$262.0M	$1.1B	$785.0M	—	—	-$599.0M	$743.0M	$536.0M	$1.2B	-$1.3B	-$198.0M	-$1.2B	$366.0M	-$73.0M	-$2.0B	-$1.1B	-$1.0B	+11.8%
FCF Margin	0.5%	-4.9%	2.0%	8.3%	4.9%	—	—	-4.0%	4.9%	3.7%	8.7%	-11.2%	-1.8%	-11.4%	3.3%	-0.6%	-15.3%	-8.5%	-6.7%	+1.8pp
EPS (Diluted)	$4.22	$4.38	$3.29	$2.57	$2.21	$1.84	$0.94	$0.71	$1.37	$-14.49	$-3.88	$1.99	$1.68	$1.99	$2.35	$0.71	$1.92	$1.70	$1.76	+3.5%

Total Debt$25.5B

Cash & Equiv.$57.0M

Net Debt$25.5B

4 min read

1. THE BIG PICTURE

FirstEnergy is a utility in transition, moving away from the reputational and financial shadow of the HB 6 lobbying scandal toward a future defined by the "Energize365" capital plan. FirstEnergy is betting its future on a $36 billion investment cycle in transmission and distribution, essentially trading short-term cash flow for a larger, more profitable regulated rate base. Success depends entirely on FirstEnergy’s ability to maintain the favor of state regulators who must approve the rate hikes required to pay for this expansion.

2. WHERE THE RISKS HIT HARDEST

FirstEnergy’s primary strength—its scale as one of the nation’s largest investor-owned electric systems—is directly threatened by regulatory recovery risk. While FirstEnergy operates 24,000 miles of transmission lines (10-K Item 1), its ability to earn a return on that hardware is not guaranteed. For example, a November 2025 Ohio Base Rate Case order resulted in an impairment charge, proving that regulators can and do disallow cost recovery when political or third-party pressure mounts (Competitive Position).

Furthermore, the $36 billion Energize365 plan is threatened by interest rate and financing exposure. Because FirstEnergy has negative free cash flow (FCF MarginFCF MarginFree Cash Flow as a percentage of revenue — how much of every dollar in sales actually turns into usable cash of -8.0% per XBRL) and relies on variable-rate debt, sustained high interest rates could make the cost of funding these projects prohibitive. Any credit rating downgrade linked to the HB 6 investigation would further increase these financing costs, potentially stalling the very investment plan intended to drive growth (Risks).

3. WHAT THE NUMBERS SAY TOGETHER

The financial data reveals a company growing its top line quickly but struggling with efficiency relative to its peers. Revenue grew by 12% over the last twelve months (XBRL), yet FirstEnergy’s operating margin of 19.7% ranks 5th among its 6 primary peers (Peer Benchmarking). This suggests that while FirstEnergy is successfully expanding its footprint and implementing rate cases—such as the Pennsylvania base rate case that drove Q3 2025 results—it has not yet translated that scale into superior profitability (10-Q).

The growth trajectory appears structural rather than a one-time spike; the 11% revenue growth in the most recent quarter (Q3 2025) aligns closely with the 12% TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter growth rate. However, investor skepticism remains visible in the supplemental signals. Short interest stands at 6.5% of the float, with 5.3 days to cover (Yahoo Finance), suggesting a significant cohort of investors is betting against the recovery narrative or hedging against further regulatory setbacks.

4. IS IT WORTH IT AT THIS PRICE?

At a Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations of 17.2x, FirstEnergy trades at a modest discount to the peer median of 17.9x (Peer Benchmarking). According to the CAPM analysis, the market is currently pricing in approximately 2.0% long-term growth. This valuation appears cautious when compared to management’s stated goal of 6-8% compounded annual growth in Core EPSEPSEarnings Per Share — the company's net profit divided by its share count; the most common per-share profitability metric through 2030 (8-K).

The discount is likely a "transparency tax" related to the HB 6 Deferred Prosecution Agreement. If FirstEnergy can demonstrate consistent execution of the Energize365 plan without further regulatory impairments, there is a clear path to valuation parity with peers like DTE or AEE. However, if growth slows to 2.5%—still above the market's current 2% implication—the justified multiple would rise to 18.8x, representing roughly 10% upside (CAPM analysis). The current price is right only if one believes regulatory friction will permanently cap growth near the 2% mark.

5. WHAT WOULD CHANGE THIS VIEW?

Cautious if there is any notification of non-compliance with the three-year Deferred Prosecution Agreement, as this could trigger a default under existing credit agreements (Risks).
Cautious if the FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin (currently -8.0%) continues to deteriorate, signaling that capital expenditures are outstripping FirstEnergy's ability to secure timely rate relief (XBRL).
Constructive if the consolidation of the Ohio Companies into a single legal entity is finalized, which management identifies as a key strategic priority to streamline operations (10-K Item 1).

6. BOTTOM LINE

Structural Advantage: Massive regulated transmission scale and a concentrated Midwest/Mid-Atlantic customer base that provides a predictable foundation for rate-base expansion.

Bottom Line: FirstEnergy is a classic "show-me" story where the valuation discount will only disappear once FirstEnergy proves it can execute its $36 billion investment plan without further legal or regulatory interference.

Source: Synthesis · LLM Analysis

4 min read

1. Top 5 Material Risks

Legal and Reputational Fallout: FirstEnergy remains subject to obligations under a three-year Deferred Prosecution Agreement (DPA) related to HB 6 lobbying activities. Failure to comply with the DPA or anti-corruption laws could trigger an event of default under credit agreements, cutting off access to credit facilities.
Regulatory Cost Recovery: FirstEnergy’s ability to recover costs for distribution and transmission investments is subject to approval by state and federal regulators. Denials or delays in rate cases—or third-party pressure to moderate rate increases—could restrict the recovery of service costs and negatively impact cash flows.
Capital Investment Execution: The Energize365 plan requires $36 billion in capital investments through 2030. FirstEnergy faces risks of price increases for labor and materials, contractor nonperformance, and potential project cancellations, which could lead to significant termination penalties or unrecoverable costs.
Interest Rate and Financing Exposure: FirstEnergy has near-term exposure to variable interest rates on short-term debt and must access capital markets to fund maturing obligations. Sustained increases in interest rates or credit rating downgrades could increase financing costs and limit the ability to execute business strategies.
Cybersecurity and Operational Disruptions: FirstEnergy relies on complex IT systems to manage its networks. Sophisticated cyber-attacks or ransomware could lead to significant remediation costs, regulatory penalties, and the inability to conduct critical business functions, materially affecting financial results.

2. Company-Specific Risks

Data Center Load Uncertainty: FirstEnergy faces potential load requirements of up to 16,985 MWs through 2035 from new data centers. If these projects fail to materialize or if usage is lower than projected, FirstEnergy’s load growth and revenue forecasts could be adversely impacted.
Coal-Fired Generation Exposure: Through its subsidiary MP, FirstEnergy controls approximately 3,160 MWs of coal-fired generation. Policies from lenders, investors, and insurers limiting coal-related investments could restrict FirstEnergy’s access to capital and increase the cost of insurance.
Goodwill Impairment: As of December 31, 2025, JCP&L carried approximately $1.8 billion of goodwill on its balance sheet. Future impairment tests could result in write-offs that negatively affect results of operations.
Pension and OPEB Volatility: FirstEnergy recognizes changes in the fair value of pension and OPEB plan assets in its fourth-quarter income. Market fluctuations or changes in discount rates can cause significant volatility in expenses and may require additional funding.

3. Regulatory/Legal Risks

FERC Reliability Standards: FirstEnergy is subject to mandatory reliability standards; failure to comply can result in penalties of up to $1.5 million per day, subject to inflation adjustments.
Corporate Alternative Minimum Tax (AMT): FirstEnergy believes it is likely subject to the corporate AMT under the Inflation Reduction Act of 2022. Future IRS guidance or Treasury regulations could significantly change FirstEnergy’s AMT estimates or tax liabilities.
Environmental Compliance: FirstEnergy faces potential EPA investigations under the New Source Review (NSR) program. Alleged violations of air quality standards or GHG regulations could lead to substantial fines, the need for pollution control equipment, or the forced shutdown of facilities.
PJM Market Risks: As a member of PJM, FirstEnergy is exposed to the allocation of losses from unreimbursed defaults of other market participants and potential refunds of previously earned revenues resulting from complaint cases filed against PJM.

4. Financial Impact Map

HB 6 Legal/DPA Obligations → Liquidity/Credit Facilities → Potential event of default under credit agreements, preventing access to borrowings and letters of credit. Regulatory Rate Case Denials → Revenue/Cash Flows → Inability to recover cost of service or earn authorized return on equity, restricting operational resources. Energize365 Capital Plan → Operating Expenses/Capital Expenditures → Potential for significant termination payments or penalties if construction agreements are canceled. Credit Rating Downgrades → Interest Expense → Increased costs on long-term debt obligations and higher fees on existing credit facilities. Pension/OPEB Plan Assets → Net Income → Volatility in fair value adjustments recognized in the fourth quarter, impacting reported earnings.

Source: 10-K Item 1A · LLM Analysis

Recent Filings

Form	Filed	Period
10-K	Feb 2026	Dec 2025
8-K	Feb 2026	—
10-Q	Oct 2025	Sep 2025
14A	Apr 2025	—