After spending much of the past six months at a middle-of-the-road three-star rank, FirstEnergy (NYSE: FE) has impressed enough top-performing members of our 165,000-strong Motley Fool CAPS community to once again be touching the four-star level. A total of 324 members have given their opinion on the electric utility operator, with many of them offering analysis and commentary explaining the recent optimism.

With the proposed purchase of Allegheny Energy (NYSE: AYE), FirstEnergy stands to become one of the nation's largest power companies. It'll expand into new states and create operating synergies that are expected to save on costs and add to earnings in the first year. Many CAPS members like the long-term outlook for electricity demand and see good potential for stable growth over the long haul.                                        

Though the past few years have been tough on power producers, FirstEnergy generated a 30% jump in first-quarter earnings helped by an increase in sales to industrial customers and expects strong demand throughout 2010. A similar sentiment has been echoed by other utilities -- Southern Company (NYSE: SO) saw an uptick in first-quarter industrial activity, and Duke Energy's (NYSE: DUK) first-quarter earnings rose 29% as it saw signs of increased activity, too.          

And things are looking good so far this summer. Due to higher temperatures across the nation, the Energy Department recently said electricity demand may climb 3.5% in the second half of the year from a year earlier, and the recent heat wave in the Northeast has pushed electricity demand to levels not seen since the summer of 2006. Consolidated Edison (NYSE: ED), which serves parts of New Jersey and Pennsylvania just as FirstEnergy does, said demand recently reached close to record levels for the company. 

Of course, no utility is worth its salt without a juicy dividend, and many CAPS members take heart in FirstEnergy's solid dividend payout. Similar to other utilities like Exelon's (NYSE: EXC) 5.1% dividend yield and PPL's (NYSE: PPL) 5.3% yield, FirstEnergy is currently paying out a healthy 5.9%, which adds some juice to any potential growth in the stock.

Do you think FirstEnergy deserves to be a four-star stock? Add your thoughts in the comments box below on this page, or head over to CAPS to rate the company and check out all the information and opinions the community offers, absolutely free.