People don’t like having their Super Bowl viewing experience tainted. And that’s why Entergy (NYSE: ETR) is getting some blowback today.
The $11 billion energy giant took full responsibility today for the 34-minute power outage that halted play during last Sunday’s Super Bowl at the New Orleans Superdome. A faulty relay device – brought in specifically for the Super Bowl – was the culprit behind the sudden power failure, the company said.
A power outage during the Super Bowl isn’t exactly a disaster on the level of BP’s (NYSE: BP) Deepwater Horizon oil spill. But it’s bad publicity nonetheless – especially considering 108 million people were watching when it happened.
So it’s no surprise that the bad publicity is hurting Entergy’s stock today. ETR shares were down 1.9% as of 12:30 eastern time. The stock has now fallen 11.5% since the beginning of November – right after Hurricane Sandy left millions of people in the Northeast without power.
As my colleague Kevin McElroy always says, bad publicity often creates buying opportunities.
This Super Bowl gaffe doesn’t change the fact that Entergy is a solid company that has increased its profits each of the last three years. What the bad publicity may do, however, is make ETR shares more affordable than they should be. At less than 13 times forward earnings right now, that appears to be the case.
A freak power outage at the Super Bowl doesn’t look good. But it’s also not a death sentence for Entergy.