Analyst Applauds FirstEnergy Profit Outlook

NEW YORK (AP) — FirstEnergy Corp.'s upbeat 2009 profit outlook and strong cash position encouraged an analyst, who rated the regional electric utility "Outperform" and said its shares should "respond positively" to the news.

On Tuesday the company predicted adjusted full-year earnings between $3.70 and $3.85 per share, exceeding original analyst estimates of $3.71 per share, according to a Thomson Reuters survey. Analysts typically exclude one-time items. Including several special items, FirstEnergy expects a profit between $3.59 and $3.74 per share.

The company said that while it is too early to provide guidance beyond 2009, it is "working to produce 2010 earnings results similar to 2009." For 2011, "several positive drivers are expected to provide an uplift to earnings." Analysts originally estimated 2010 and 2011 earnings of $3.48 and $4.33 per share.

Credit Suisse analyst Dan Eggers noted that the company does not plan to issue equity, which is good news for the company's earnings per share. Eggers expected $500 million of equity, which had dragged his 2009, 2010 and 2011 profit estimates by 4 cents, 5 cents and 10 cents per share, respectively.

Eggers currently expects 2009, 2010 and 2011 profit of $3.46, $3.16 and $4.49 per share, respectively. His price target is $41.

Shares of FirstEnergy rose 10 cents to $38.68 in afternoon trading.