A class-action lawsuit alleges the destruction 'could have been avoided' if the Hawaiian Electric hut down power before the high winds hit.
Wells Fargo subsequently lowered its price target on the stock to $25 per share from $35 on Sunday. The firm maintained its underweight rating.
"While it remains unclear if any of HE's equipment directly caused any of the wildfires, we believe it prudent to account for the risk given recent wildfire-related claims in CA, CO & OR that have all exceeded $1B, HE is already being scrutinized and our understanding of HI's liability standards," analyst Jonathan Reeder wrote in a note to clients.
The cause of the wildfires are still under investigation. Hawaiian Electric spokesperson Jim Kelly told NBC News the company doesn't comment on pending litigation, saying its immediate focus is supporting emergency response efforts and restoring power. "At this early stage, the cause of the fire has not been determined and we will work with the state and county as they conduct their review," he said in a statement.
The company was aware that shutting power down is an effective strategy but didn't adopt it as part of its fire mitigation plans, theWith Monday's decline, the shares are down 44% in August.
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