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Constellation Energy Corporation (CEG)
NASDAQ:CEG
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Constellation Energy Corporation
(NASDAQ:CEG)58Neutral
Positive Factors
Strategic Growth
The acquisition deal unlocks strategic value for CEG by offering new inorganic growth levers and a more diversified exposure to electricity markets.
Negative Factors
Market Risks
Extreme weather conditions and a slowdown in data center contracts could impact power prices and cap earnings growth.
Valuation Concerns
The company's valuations at forward PE of 30x are considered rich, suggesting investors should find better entry points.
Constellation Energy Corporation (CEG) vs. S&P 500 (SPY)
Market Cap
$66.49B
Dividend Yield0.66%
Average Volume (3M)4.87M
Price to Earnings (P/E)17.9
Beta (1Y)1.38
Revenue Growth6.89%
EPS Growth137.32%
CountryUS
Employees14,264
SectorUtilities
Sector Strength79
IndustryRenewable Energy Producers
Share Statistics
EPS (TTM)11.89
Shares Outstanding312,847,260
10 Day Avg. Volume5,555,591
30 Day Avg. Volume4,867,666
Financial Highlights & Ratios
PEG Ratio0.13
Price to Book (P/B)N/A
Price to Sales (P/S)2.82
Price to Cash Flow (P/CF)-16.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$318.86Price Target Upside50.02% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
Constellation Energy Corporation Business Overview & Revenue Model
Company DescriptionConstellation Energy Corporation (CEG) is a leading provider of clean energy solutions in the United States, specializing in the generation and distribution of nuclear, wind, solar, and hydroelectric power. The company operates across various sectors including residential, commercial, and industrial energy supply, offering a diverse range of energy products and services tailored to meet the needs of its customers. Constellation Energy is dedicated to delivering sustainable and reliable energy solutions while maintaining a strong focus on environmental stewardship.
How the Company Makes MoneyConstellation Energy Corporation makes money primarily through the generation and sale of electricity. The company owns and operates a diverse portfolio of power plants, including nuclear, wind, solar, and hydroelectric facilities, which generate electricity sold to residential, commercial, and industrial customers. Revenue is generated through long-term power purchase agreements, retail energy sales, and wholesale market transactions. Additionally, Constellation Energy offers energy management and efficiency solutions to help customers optimize their energy consumption and reduce costs, further contributing to its revenue streams. The company's strategic partnerships and investments in renewable energy projects also play a significant role in its earnings by expanding its capacity to meet the growing demand for clean energy.
Constellation Energy Corporation Financial Statement Overview
Summary
Constellation Energy Corporation demonstrates strengths in its gross profit margin and equity base, but faces challenges with revenue volatility, high debt levels, and negative cash flows. The company needs to focus on improving operational efficiencies and managing its leverage to secure long-term financial health.Income Statement
The company's revenue has fluctuated over the years, with a notable decline from 2023 to 2024. The gross profit margin improved significantly in 2024, indicating better cost management or product mix. However, net profit and EBIT margins remain volatile, highlighting challenges in maintaining consistent profitability.55
Neutral
Balance Sheet
The balance sheet shows a strong equity position relative to total assets, but the high debt levels result in a concerning debt-to-equity ratio. The company's equity ratio has been relatively stable, suggesting a steady asset base, yet the high leverage could pose financial risks if not managed properly.60
Neutral
Cash Flow
Operating cash flow has been negative in recent years, indicating potential difficulties in sustaining operations without external financing. Free cash flow remains negative, suggesting continued capital investments or operational inefficiencies. However, the company has shown some ability to generate positive investing cash flow, which might support future growth.45
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 23.57B | 24.92B | 24.44B | 19.65B | 17.60B | Gross Profit |
| 17.41B | 3.23B | 2.14B | 2.93B | 2.85B | EBIT |
| 4.35B | 1.61B | -292.00M | -177.00M | 1.18B | EBITDA |
| 5.14B | 4.25B | 2.14B | 4.99B | 4.83B | Net Income Common Stockholders |
| 3.75B | 1.62B | -154.00M | -73.00M | 589.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 109.00M | 368.00M | 422.00M | 504.00M | 226.00M | Total Assets |
| 52.93B | 50.76B | 46.91B | 48.09B | 48.09B | Total Debt |
| 8.41B | 9.26B | 5.77B | 8.20B | 7.21B | Net Debt |
| 8.30B | 8.89B | 5.35B | 7.69B | 6.99B | Total Liabilities |
| 39.39B | 39.47B | 35.54B | 36.47B | 33.42B | Stockholders Equity |
| 13.17B | 10.93B | 11.02B | 11.22B | 12.40B |
| Cash Flow | Free Cash Flow | |||
| -5.03B | -7.72B | -4.04B | -2.67B | -1.16B | Operating Cash Flow |
| -2.46B | -5.30B | -2.35B | -1.34B | 584.00M | Investing Cash Flow |
| 7.43B | 3.03B | 3.10B | 3.28B | 1.96B | Financing Cash Flow |
| -2.29B | 2.20B | -799.00M | -1.70B | -2.66B |
Constellation Energy Corporation Technical Analysis
Negative
212.54
Price Trends
279.78
Negative
263.75
Negative
236.05
Negative
Market Momentum
-20.79
Positive
27.94
Positive
7.93
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CEG, the sentiment is Negative. The current price of 212.54 is below the 20-day moving average (MA) of 276.75, below the 50-day MA of 279.78, and below the 200-day MA of 236.05, indicating a bearish trend. The MACD of -20.79 indicates Positive momentum. The RSI at 27.94 is Positive, neither overbought nor oversold. The STOCH value of 7.93 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CEG.
Constellation Energy Corporation Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $90.64B | 20.54 | 9.10% | 3.56% | 4.46% | 54.09% | |
72 Outperform | $43.33B | 17.58 | 9.34% | 3.57% | 5.98% | 4.99% | |
71 Outperform | $47.05B | 22.65 | 7.91% | 4.83% | -10.79% | 18.04% | |
67 Neutral | $149.81B | 21.59 | 14.24% | 2.90% | 26.91% | -6.43% | |
65 Neutral | $12.05B | 15.92 | 6.71% | 4.32% | 8.04% | 3.76% | |
64 Neutral | $45.15B | 15.69 | 9.55% | 3.58% | -18.00% | -7.54% | |
58 Neutral | $66.49B | 17.86 | 31.12% | 0.66% | 6.89% | 137.32% |
* Utilities Sector Average
Performance Comparison
CEG
Constellation Energy Corporation
212.54
45.77
27.44%
D
Dominion Energy
55.22
9.80
21.58%
DUK
Duke Energy
116.74
24.47
26.52%
EXC
Exelon
43.11
7.36
20.59%
NEE
NextEra Energy
72.83
16.55
29.41%
SRE
Sempra Energy
69.30
-1.02
-1.45%
Constellation Energy Corporation Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: -32.89% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Constellation Energy's robust financial performance and operational success, particularly in its nuclear and commercial segments. However, challenges remain in regulatory areas, specifically regarding FERC rulings and capacity market issues. Overall, the positive financial and operational achievements slightly outweigh the regulatory and market challenges.Highlights
Strong Financial Performance
Constellation Energy reported GAAP earnings of $3.82 per share and adjusted operating earnings of $2.74 per share, which was $0.61 higher than the previous year. They raised and narrowed their adjusted operating earnings guidance for the full year to $8 to $8.40 per share.
Nuclear Fleet Performance
Nuclear plants produced over 41 million-megawatt hours with a capacity factor of 95%. Refueling outages averaged less than 18 days, significantly below the industry average of 40 days.
Renewable and Natural Gas Fleet Performance
Renewables had a 96% energy capture rate, and natural gas had a 98.2% power dispatch matching.
Commercial Business Success
Continued strong performance in the commercial business, with margins above long-term averages and enhanced margins disclosed earlier in the year.
Crane Clean Energy Center Restart
The restart of the Crane Clean Energy Center validates the revival of nuclear energy and the growing demand for 24/7 clean energy.
Lowlights
FERC Ruling on Colocation
FERC's 2:1 ruling against Talend's ISA was narrow but poses challenges for colocation and competitive markets.
Capacity Market Challenges
The capacity market has faced delays and challenges in moving forward, leading to uncertainty in price signals necessary for market response.
Company Guidance
In Constellation Energy Corporation's third-quarter 2024 earnings call, the company reported GAAP earnings of $2.82 per share and adjusted operating earnings of $2.74 per share. Due to strong performance, Constellation raised its full-year adjusted operating earnings guidance to a range of $8 to $8.40 per share, with a midpoint of $8.20, a significant increase from the original midpoint of $7.60. The company highlighted a robust nuclear performance with a 95% capacity factor and exceptional refueling outage efficiency, averaging under 20 days per outage, well below the industry average. Constellation also noted a 96% renewable energy capture and an impressive 98.2% power dispatch matching for their renewables and natural gas fleet. Furthermore, the commercial business has outperformed expectations, contributing to an increase in enhanced gross margin by $275 million. Constellation reiterated its commitment to a 13% compounded base EPS growth through 2030, supported by strategic initiatives such as the Crane Clean Energy Center restart and additional nuclear generation uprates.Constellation Energy Corporation Corporate Events
M&A TransactionsStock BuybackDividendsBusiness Operations and StrategyFinancial Disclosures
Constellation Energy Reports Strong 2024 Financial Results
Positive
Feb 18, 2025
On February 18, 2025, Constellation Energy Corporation announced its financial results for the fourth quarter and full year 2024, showcasing a significant increase in earnings per share compared to the previous year. The company also revealed strategic moves, including the acquisition of Calpine Corporation, aimed at enhancing its product offerings and market reach. Their commitment to sustainability was highlighted by their ranking as the number one producer of emissions-free energy for the 11th year and their issuance of a green bond. Constellation also demonstrated shareholder value through share repurchases, dividend increases, and credit rating upgrades.
M&A TransactionsBusiness Operations and Strategy
Constellation Energy Acquires Calpine for $16.4 Billion
Positive
Jan 10, 2025
Constellation Energy Corporation announced its acquisition of Calpine Corporation in a $16.4 billion cash and stock transaction, creating the largest clean energy provider in the U.S. This strategic move expands Constellation’s footprint and product offerings, enhancing its ability to serve 2.5 million customers with diverse energy solutions and reinforcing its leadership position in the clean energy sector. The acquisition is expected to be immediately accretive to Constellation’s earnings, delivering significant financial benefits and growth opportunities, while also advancing the company’s commitment to sustainability and innovation in energy technologies.
Executive/Board Changes
Constellation Energy Strengthens Board with New Appointments
Positive
Dec 13, 2024
Constellation Energy Corporation announced changes to its Board of Directors as Laurie Brlas retires, making way for new appointees Eileen Paterson and Peter Oppenheimer. These appointments are expected to strengthen the board with their financial, operational, and technological expertise, supporting Constellation’s continuing growth and innovation in the energy sector.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.