FirstEnergy offers a regulated, data-center-enabled 10% rate-base growth runway and attractive income, but elevated leverage and regulatory execution keep the opportunity a balanced long-term buy.
Overview
FirstEnergy is an Akron, Ohio-based investor-owned electric utility serving more than six million customers across 65,000 square miles in six Midwest and Mid-Atlantic states. Its regulated distribution and transmission businesses create essential, relatively predictable revenue, while its PJM footprint and approximately 24,000 miles of high-voltage lines position it to benefit from hyperscale data-center interconnections. **The key growth engine is the expanded $36 billion Energize365 program for 2026–2030**, which is 30% above the prior plan, allocates more than $19 billion to transmission, and targets approximately 10% annual rate-base growth. Data-center forecast demand reached 24.8 GW, with 6.4 GW contracted and 18.6 GW still in study or pipeline phases. Q2 2026 revenue rose 8.8% year over year to $3.68 billion and GAAP EPS increased 8.7% to $0.50, although Core EPS fell 3.8% to $0.50 due to cost timing. Management reaffirmed 2026 Core EPS guidance of $2.62–$2.82 and long-term 6%–8% growth. At 16.2x–16.8x forward P/E versus a 15.3x–15.9x utility average, the premium reflects growth and regulatory quality, while the $45.88 scenario starting price implies a probability-weighted five-year target of $59.16. Near-term catalysts include rate cases, data-center contracting, transmission awards, and execution of the capital plan.