Dan Loeb's PG&E Play: Growth, Resilience, And $63 Billion Investments

Pacific Gas & Electric Co. PCG stock has recently faced volatility amid shifting investor sentiment and market dynamics.

Activist investor Dan Loeb‘s hedge fund, Third Point, held 49.7 million shares in utility company Pacific Gas & Electric Co. PCG as of Sept. 30, 2024, making it the fund’s largest holding at the time.

On Jan. 13, 2025, BMO Capital analyst James M. Thalacker initiated coverage on the company with an Outperform and a price target of $21.

The analyst writes that he views PCG shares as a core holding in the regulated utility sector, offering investors a rare combination of deep value and premium, visible growth potential.

Thalacker’s five-year forecast (2024-2028) projects EPS growth of around 9.2% and rate base growth of about 10%, aligning with the company's long-term EPS target of at least 9%.

Also, on Dec. 17, JPMorgan analysts Jeremy Tonet and Richard W. Sunderland stated that they believe PG&E's wildfire mitigation investments, data center pipeline and re-rating potential could drive substantial gains. 

Notably, last month, the Department of Energy disclosed plans to provide Pacific Gas & Electric with a record $15 billion loan guarantee to strengthen its electrical grid and support climate resiliency initiatives.

If finalized, the loan guarantee for PG&E’s Project Polaris will support hydropower, battery storage, transmission upgrades, and virtual power plants across its service area.

The Energy Department said that these infrastructure investments will enable PG&E to address projected load growth, enhance electric reliability, and lower costs for consumers throughout California.

Earlier, during its third-quarter earnings call, PCG raised its five-year capital investment plan by $1 billion, bringing the total to $63 billion for the 2024-2028 period.

The company also reaffirmed its equity issuance guidance of $3 billion for 2025-2028.

The company expects to release its fourth-quarter earnings results in February 2025.

Investors can gain exposure to the stock via VanEck Uranium and Nuclear ETF NLR and Themes ETF Trust Themes Uranium & Nuclear ETF URAN.

Price Action: PCG shares are up 4.71% at $17 at last check Wednesday.

Read Next:

• LA Braces For More ‘Extreme Fire Weather,’ Multiple Lawsuits Filed Against Edison Over Eaton Fire Damages

Photo: Shutterstock