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Public Service Enterprise (PEG)
NYSE:PEG
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Public Service Enterprise
(NYSE:PEG)
56Neutral
Positive Factors
Financial Performance
PEG reported strong FY'24 results, aligning with consensus estimates and indicating a robust financial performance.
Growth Outlook
Public Service Enterprise Group has rolled forward a long-term earnings growth outlook of 5-7% CAGR for 2025-2029, with a new baseline that represents 9% growth compared to 2024.
Negative Factors
Valuation Concerns
PEG shares trade at a ~17% premium on our updated 2027 EPS estimate.
Public Service Enterprise (PEG) vs. S&P 500 (SPY)
Market Cap
$39.18B
Dividend Yield3.05%
Average Volume (3M)3.02M
Price to Earnings (P/E)22.3
Beta (1Y)0.56
Revenue Growth6.13%
EPS Growth-31.01%
CountryUS
Employees13,047
SectorUtilities
Sector Strength84
IndustryRegulated Utilities
Share Statistics
EPS (TTM)3.54
Shares Outstanding498,561,460
10 Day Avg. Volume4,358,630
30 Day Avg. Volume3,024,419
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.81
Price to Cash Flow (P/CF)26.70
P/FCF Ratio22.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$91.40Price Target Upside16.36% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Public Service Enterprise Business Overview & Revenue Model
Company DescriptionPublic Service Enterprise Group Incorporated is a diversified energy company. The company engages in the generation, transmission, and distributions of electricity and gas to residential, commercial, and industrial customers in the Northeastern and Mid-Atlantic United States.
How the Company Makes MoneyPublic Service Enterprise Group (PEG) generates revenue through its two main subsidiaries: PSE&G and PSEG Power. PSE&G, as a regulated utility, earns money by providing electricity and gas distribution services to residential, commercial, and industrial customers, with rates set by regulatory bodies ensuring a stable income based on infrastructure investments and operational costs. PSEG Power earns revenue by selling electricity generated from its power plants in the wholesale energy market. This includes income from its nuclear, natural gas, and solar facilities. The company's earnings are also influenced by regulatory support for clean energy initiatives and energy market conditions. Key partnerships with state and federal agencies also play a role in securing favorable operational conditions and incentives for clean energy projects.
Public Service Enterprise Financial Statement Overview
Summary
Public Service Enterprise shows a mixed financial performance. Revenue growth is inconsistent, with notable declines impacting profitability. While gross profit margins have improved, the net profit margin has decreased, indicating cost pressures. The balance sheet shows increased leverage, posing a risk to financial stability. Cash flow from operations has weakened, highlighting challenges in maintaining liquidity. The company must address these issues to ensure long-term financial health.Income Statement
The company's revenue has shown moderate growth with a 5.1% increase from 2022 to 2023 but a decline of 8.4% from 2023 to 2024. Gross profit margin improved from 48.4% in 2023 to 67.4% in 2024, indicating better cost management. However, net income decreased significantly by 30.9% from 2023 to 2024, affecting the net profit margin, which dropped from 22.8% to 17.2%. This indicates pressure on profitability despite gross margin improvements.62
Positive
Balance Sheet
The debt-to-equity ratio increased from 1.32 in 2023 to 1.41 in 2024, suggesting higher leverage and potential risk in financial stability. The equity ratio slightly decreased, illustrating a marginal decline in equity financing. Return on equity decreased from 16.6% in 2023 to 11% in 2024, indicating less efficient use of equity capital.55
Neutral
Cash Flow
Operating cash flow decreased by 54.7% from 2023 to 2024, negatively impacting cash flow stability. Free cash flow turned negative in 2024, indicating concerns about cash generation capacity. The operating cash flow to net income ratio dropped from 1.48 in 2023 to 0.97 in 2024, which could affect the company's ability to sustain operations and fund future growth.48
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 10.29B | 11.24B | 9.80B | 9.72B | 9.60B | Gross Profit |
| 3.54B | 4.83B | 2.60B | 3.00B | 3.43B | EBIT |
| 2.35B | 3.69B | 1.38B | -856.00M | 2.27B | EBITDA |
| 4.09B | 5.09B | 2.85B | 814.00M | 4.28B | Net Income Common Stockholders |
| 1.77B | 2.56B | 1.03B | -648.00M | 1.91B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 125.00M | 54.00M | 465.00M | 818.00M | 543.00M | Total Assets |
| 54.64B | 50.74B | 48.72B | 49.00B | 50.05B | Total Debt |
| 22.89B | 20.41B | 20.44B | 19.63B | 17.50B | Net Debt |
| 22.76B | 20.35B | 19.97B | 18.81B | 16.95B | Total Liabilities |
| 38.53B | 35.26B | 34.99B | 34.56B | 34.07B | Stockholders Equity |
| 16.11B | 15.48B | 13.73B | 14.44B | 15.98B |
| Cash Flow | Free Cash Flow | |||
| -1.25B | 481.00M | -1.39B | -983.00M | 68.00M | Operating Cash Flow |
| 2.13B | 3.81B | 1.50B | 1.74B | 3.10B | Investing Cash Flow |
| -3.31B | -2.96B | -1.10B | -2.24B | -2.68B | Financing Cash Flow |
| 1.23B | -1.26B | -754.00M | 799.00M | -30.00M |
Public Service Enterprise Technical Analysis
Negative
78.55
Price Trends
83.35
Negative
85.32
Negative
81.47
Negative
Market Momentum
-1.43
Positive
34.64
Neutral
19.28
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PEG, the sentiment is Negative. The current price of 78.55 is below the 20-day moving average (MA) of 81.71, below the 50-day MA of 83.35, and below the 200-day MA of 81.47, indicating a bearish trend. The MACD of -1.43 indicates Positive momentum. The RSI at 34.64 is Neutral, neither overbought nor oversold. The STOCH value of 19.28 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PEG.
Public Service Enterprise Risk Analysis
Public Service Enterprise disclosed 28 risk factors in its most recent earnings report. Public Service Enterprise reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Public Service Enterprise 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 | $91.39B | 20.85 | 9.10% | 3.51% | 4.46% | 54.09% | |
77 Outperform | $98.82B | 23.28 | 13.61% | 3.10% | 5.83% | 10.23% | |
74 Outperform | $36.64B | 20.35 | 8.44% | 3.13% | 4.23% | -27.02% | |
73 Outperform | $57.22B | 18.74 | 11.37% | 3.46% | 2.76% | 31.53% | |
72 Outperform | $43.63B | 17.84 | 9.34% | 3.52% | 5.98% | 4.99% | |
65 Neutral | $11.91B | 15.60 | 6.55% | 4.41% | 7.00% | 0.55% | |
56 Neutral | $39.18B | 22.32 | 11.22% | 3.05% | 6.13% | -31.01% |
* Utilities Sector Average
Performance Comparison
PEG
Public Service Enterprise
78.55
16.54
26.67%
AEP
American Electric Power
104.43
24.51
30.67%
ED
Consolidated Edison
103.77
17.22
19.90%
DUK
Duke Energy
117.70
25.76
28.02%
EXC
Exelon
43.40
7.84
22.05%
SO
Southern Co
90.10
22.50
33.28%
Public Service Enterprise Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -6.14% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
PSEG demonstrated strong operational performance and strategic achievements, including increased investments in clean energy and customer satisfaction accolades. However, financial challenges were evident with a decline in net income and impacts from rising capacity prices. The positive results in operational areas and future growth prospects outweigh financial setbacks.Highlights
Record Non-GAAP Operating Earnings
PSEG reported non-GAAP operating earnings of $0.84 per share for Q4 2024 and $3.68 per share for the full year, marking the 20th consecutive year of meeting or exceeding guidance.
Approval for Clean Energy Investment
PSE&G received approval to invest $2.9 billion in its Clean Energy Future Energy Efficiency II program over six years, significantly increasing energy efficiency investments.
Capital Spending and Infrastructure Success
Successfully executed a $3.6 billion capital spending program for 2024, including the completion of the advanced metering infrastructure program on time and on budget.
Customer Satisfaction and Reliability Awards
PSE&G was named number one in customer satisfaction by J.D. Power and received the PA Consulting 2024 ReliabilityOne Award for the 23rd consecutive year.
Dividend Increase
The Board of Directors announced a $0.12 per share increase in PSEG's annual common dividend, marking the 14th consecutive annual increase.
Lowlights
Decline in Net Income
PSEG reported net income of $3.54 per share for the full year 2024, compared with $5.13 per share for 2023, indicating a decline in profitability.
Impact of Rising Capacity Prices
The basic generation service auction results will raise residential bills starting June 1 due to a significant rise in capacity prices from PJM's latest auction.
Warmer Than Normal Weather
Weather during Q4 2024 was 12% warmer than normal, impacting gas revenues, although mitigated by the conservation incentive program.
Company Guidance
During the PSEG earnings call, guidance for 2025 was outlined, highlighting several key metrics. PSEG's non-GAAP operating earnings guidance for 2025 is set at $3.94 to $4.06 per share, marking a 9% increase at the midpoint over 2024's results. The company plans to invest $4 billion in 2025, primarily in regulated investments, and has increased its 2025-2029 capital spending plan to $22.5 billion to $26 billion. This investment is expected to support a 6% to 7.5% compound annual growth rate (CAGR) for PSE&G's rate base over five years, starting from approximately $34 billion at the end of 2024. Additionally, PSEG intends to continue its strategic focus on energy efficiency and infrastructure modernization, with a $2.9 billion investment approved for its Clean Energy Future Energy Efficiency II program. The company also announced a $0.12 per share increase in its annual common dividend, bringing it to $2.52 per share for 2025.Public Service Enterprise Corporate Events
Business Operations and StrategyFinancial Disclosures
PSEG Reports Strong 2024 Earnings and Reliability Awards
Positive
Feb 25, 2025
On February 25, 2025, PSEG conducted an earnings call to discuss its financial results for the fourth quarter and full year of 2024. The company reported a net income of $0.57 per share for Q4 and $3.54 per share for the full year. Non-GAAP operating earnings were $0.84 per share for Q4 and $3.68 per share for the full year, marking the 20th consecutive year PSEG met or exceeded its non-GAAP operating earnings guidance. PSEG received the 2024 PA Consulting ReliabilityOne® Award for outstanding service reliability in the Mid-Atlantic region for the 23rd consecutive year and was recognized by J.D. Power for customer satisfaction in residential electric and gas service. The company’s nuclear capacity factor was approximately 90% for 2024, and it successfully executed around $3.6 billion in investments.
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.