BUZZ-Edison International slumps as wildfires wreak havoc; utility reportedly hit with lawsuit

Updates, adds report of lawsuit

** Shares of utility Edison International EIX.N down 12.2% at $57.07, after hitting lowest since Oct 2022, on Mon as firefighters race to contain Los Angeles wildfires before expected return of high winds

** EIX shares have now shed roughly $9 bln of market value to about $22 bln amid six-session losing streak, per LSEG data

** Southern California Edison (SCE), a unit of EIX, was sued by a group of homeowners, renters, business owners and others, blaming energy provider's equipment for igniting the Eaton Fire in the Pasadena area, Bloomberg News reported on Mon

** SCE did not immediately respond to a Reuters request for comment

** On Fri, SCE said that fire agencies to investigate whether its infrastructure is linked to the Hurst fire, adding that no determination had been made

** In a research note on Fri, Barclays reduced its PT on EIX by $8 to $76 to account for the recent possible liability

** But Barclays maintained its 'overweight' rating, saying it remains "confident in the state's AB 1054 framework, and we see the liability to shares as likely to be materially less than the level of economic damages reported"

** "The tragic nature, size and scale of the January LA Fires should not be taken lightly and we expect them to lead to additional volatility in shares in the near term as the state and EIX work through restoration and as we receive more details on the cause of these fires," Barclays said

** EIX shares on Mon easily the worst performers in the S&P 500 Utilities sector .SPLRCU, which is off ~1%

** Broader equity markets under pressure on the session as bond yields surged on expectations the Fed will stay hawkish for most of 2025 .N

(Reporting by Lance Tupper and Sinéad Carew)
(Lance Tupper is a Reuters market analyst. The views expressed are his own)

((lance.tupper@tr.com 1-646-279-6380))