EIX dropped 25%; dividend yield 6.5%, coverage 2.8x, and the trigger was failed CA wildfire legislation. The selloff may be overdone for an event that "may never happen," creating a bounce opportunity. Long EIX for a short-term rebound; author is positioned with Sept. 18 $55 calls. Actual wildfire liabilities, future legislation failure, continuation of downtrend, and bounce failing.
EIX dropped 25%; dividend yield 6.5%, coverage 2.8x, and the trigger was failed CA wildfire legislation. The selloff may be overdone for an event that "may never happen," creating a bounce opportunity. Long EIX for a short-term rebound; author is positioned with Sept. 18 $55 calls. Actual wildfire liabilities, future legislation failure, continuation of downtrend, and bounce failing.