Jim Cramer on Edison International: “I Personally Wouldn’t Take That Bet.”

Edison International (NYSE:EIX) is one of the stocks listed in our article, Jim Cramer recently discussed these 10 S&P 500 stocks. The company was the last of the worst S&P 500 performers in the first half of the year, and Cramer said:

“Finally, the fifth worst performer… of the first half was Edison International, that’s a regulated electric utility in southern California, with the stock that was down 35%. This year began with those horrific LA wildfires, which took place in the company’s service area. But that’s not what truly crushed the stock. California utilities have all proven to be bad investments this year… What’s the issue in California? Proposed regulations that were originally aimed at addressing affordability, but somehow morphed into a major regulatory overhaul.

The bill in question… would create a new regulatory authority, force utilities to take on debt to pay for fire mitigation, capital efforts, and other capital spending, while also limiting their ability to recoup these costs by raising prices. Oh man, the utilities would… have to make an ongoing contribution to a state-run wildfire insurance fund.

The bill passed the California Senate last month, and it’s still working its way through… the state assembly. I don’t want to get into the politics of this, but obviously, it would be very bad for the utilities that do business in the state. If you buy something like Edison International here, you’re betting that this bill dies in the next couple of weeks or gets vetoed by the governor. I personally wouldn’t take that bet.”

A wide aerial view of an electric power transmission facility with lines, substations, and overhead wires.

Edison International (NYSE:EIX) produces and delivers electricity throughout Southern California. The company serves residential, commercial, industrial, and agricultural customers.

While we acknowledge the potential of EIX as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.