After facing severe criticism from regulators for its alleged involvement in the latest California wildfire, electricity transmission company PG&E Corp. (NYSE: PCG) witnessed a sharp decline in its market value on Friday. The stock closed the day’s session at an all-time low of $5.
Market sentiment was further dented by a statement from Citigroup (C), saying the latest wildfire might add to the financial woes of the company, which is on the brink of bankruptcy. The sell rating on PG&E, with a price target of $5, makes it a high-risk stock.
Earlier, the management filed an incident report with the California Public Utilities Commission in connection with the fire that occurred in Sonoma County. The statement said that a transmission tower operated by the company malfunctioned near the affected area. However, it has not been confirmed whether the accident was caused by the faulty equipment. If the company’s role is proven, the stock might become worthless.
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According to the company, the area will experience power outage in the coming days, affecting nearly half a million California residents. PG&E was involved in wildfire incidents many times in the past and each time the stock suffered heavy losses in the selloff that followed.
The shares, which have been in a downward spiral for more than two years, lost about 74% since the beginning of the year.