Citi Upgrading Edison International

Citi Investment Research is out with a research report on Edison International (NYSE: EIX) and is upgrading shares to Buy and raising its price target to $45.

In a note to clients, Citi Investment Research writes, "We are lifting our target price to $45/share from $40/share. The uplift to out target price is primarily driven by the higher target multiple we now assign to regulated utilities, plus our comfort that the California regulatory environment is more balanced than we previously thought. Our target multiple of 15x for SCE EPS is inline with the multiple we assign to other utilities and corresponds to our long term regression analysis of corporate bond yields and regulated utilities. In our view, California regulatory overhang from San Bruno has cast a pall on EIX's utility value for much of the year – a pall we believe is no longer merited. Our positive view of EIX is not based on upside to merchant optionality."

Shares of EIX lost 3 cents yesterday to close at $36.27.