I don't believe FE has contracts for supply to Washington at $120 MW. Maybe for Peak MW's when it is over 90 degrees. Where I work our total out the door costs is a little less the $30 MW-hr. Take a 1000 MW unit and the profit per hour is $90,000. Plant like their 1900 MW Harrison Coal Fired Station at a 70% capacity factor will probably have revenues of about $2 million dollars/day.
Sentiment: Strong Buy
I think FE earning in eary August should beat estimate, FE upgrade a couple contracts, add supply to washington at $120 per M.W. since May from $60 previous year, plus it has been upgrade two days ago
Actually that is a pretty low rate. I believe the national average is .1231 kw-hr. Much of the east is in the mid to high teens. They need to charge you more.
I just hope my FE dividends cover the extra money I have to pay for rate increases.
It seems like just yesterday, their rate was 7 something. And now its almost 10.
Revs may not skyrocket right away.
But I guarantee you, when cold weather hits, with this outlandish rate, FE revs will SOAR.
Who would take over FE, I think they are to large. You would need at least $40/share for a takeover which would put the company over $14 billion.`Plus they would have to assume $21 billion in debt. Their value is in maintaining and increasing their dividend. IMHO
FE is a takeover taget during May, Earning will report early August, NO reduction in dividend, these factors may
cause FE zoom to $35 easy, see you there
Notice part of the rationale is improvement in PJM capacity revenues going forward. Also notice no biatching about costs of stadium naming rights.
@@@@@"The revision of FE's rating outlook to stable from negative reflects a number of credit positive developments over the past year, including a refocus on regulated operations and transmission, an improving outlook for the merchant markets and strong capacity revenues in the next few years, a dividend reduction at FE and the upgrade of several of FE's utility subsidiaries", said Swami Venkataraman, Moody's Vice President -- Senior Credit Officer. "In addition, we expect FE's consolidated financial ratios to improve in 2015-16 to levels consistent with our expectations for its current Baa3 rating, such as CFO-pre WC to debt of 13-14%, CFO-pre WC interest coverage of about 3.5x, and retained cash flow to debt of about 10-11%." Key drivers behind the expected increase in FE's cash flow coverage ratios in 2015 and 2016 are the strong improvement in PJM capacity revenues for FE's merchant fleet, higher earnings and cash flows from the transmission business, as well as substantial deferred tax benefits from the monetization of NOLs that improve cash flows.
I wouldn't recommend this to anyone but i have purchased high yielding stock and than wrote covered calls against the position to increase the yield...Always ask your broker before doing anything with options....jmho
Yes and right now it is paying over 4.5% dividend. May go down more.but who knows. I believe they have the highest dividend of any DJU and the dividend appears to be stable. Should be announcing soon.
Storms are bad this year upping the cost to maintain for above ground utilities.
PA / BPK pipe line and refinery has a power outage also for Penn Power.