Goldman Sachs this week downgraded FirstEnergy stock from “neutral” to “sell.”
FirstEnergy has a cash problem; at risk is its investment grade bond status. Goldman speculates that the company will need to issue additional stock to raise more than $1 billion.
Meanwhile, FirstEnergy continues to push for a massive bailout by customers. Recently, PUCO staff had recommended a customer-paid, above-market subsidy of $131 million a year for three to five years. In rebuttal testimony this week, FirstEnergy said it needs $558 million a year from customers for the next eight years, or $4.46 billion, to keep an investment grade bond rating.
However, information that surfaced in depositions reveals that FirstEnergy is actually seeking almost double this amount. (See related story.)