- Adjusted Earnings Per Share (EPS) Reported $1.05 for Q2, on track to meet 2025 guidance.
- Capital Plan Increase Raised to $40 billion over 4 years, including 3 GW solar and 1.4 GW battery storage.
- Industrial Sales Growth 13% expected 4-year growth rate, driven by robust industrial opportunities.
- Renewable Investments Secured 8 GW of electric service agreements since last year, with $7 GW of gas generation available for new load.
- Tax Credit Benefits Expected $175 million cash benefit in 2028 from renewable tax credits and $570 million from nuclear PTCs.
Financial Highlights
The company's adjusted EPS for the quarter was $1.05, driven by a 4.5% increase in weather-adjusted retail sales growth. The company's industrial growth opportunities remain robust, with a 4-year industrial sales growth rate expected to be approximately 13%. Entergy's management team highlighted that the company's strategy to use standardized equipment and designs helps manage costs and schedules for customers.
Capital Plan and Growth Opportunities
Entergy updated its 4-year capital plan to $40 billion, including investments in customer-driven generation, such as 3 gigawatts of solar and 1.4 gigawatts of battery storage. The company has signed roughly 8 gigawatts of electric service agreements since last year. According to the company's management, "The company secured significant new growth in Arkansas, bringing benefits to existing customers and communities."
Valuation and Financial Metrics
Entergy's valuation metrics suggest that the stock may be attractively priced. The company's P/E ratio is 21.71, and its EV/EBITDA ratio is 7.49. The stock offers a dividend yield of 2.65%. However, the company's free cash flow yield is -4.51%, indicating that the company may be investing heavily in growth opportunities. As the company's management stated, "The company expects to monetize its nuclear tax credits later this year, which is expected to provide a cash benefit of approximately $175 million in 2028."
Growth Outlook and Guidance
Entergy affirms its adjusted EPS guidance and updates its longer-term outlook. The company expects positive year-to-date results to allow flexibility in managing O&M expenses. The company's adjusted EPS for 2026 remains unchanged, while 2027 increases by $0.05 and 2028 by $0.10. Analysts expect the company's revenue growth to continue, driven by its investments in customer-driven generation and growth opportunities.