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Exelon: Exelon's Q2 2025 Earnings: Beating Expectations on Cost Management

Exelon reported operating earnings of $0.39 per share for the second quarter of 2025, surpassing expectations driven by favorable timing and effective cost management at its utilities. The actual EPS came in higher than the estimated $0.3674. Adjusted operating earnings were lower than the same period last year, primarily due to higher distribution and transmission rates, ComEd timing, and storm costs. Revenue growth is expected to be modest, with analysts estimating a 3.2% increase for the next year. With a P/E Ratio of 17.02 and a Dividend Yield of 3.47%, the stock appears to be reasonably valued, with investors pricing in a stable return.

EXC

USD 44.22

1.05%

A-Score: 6.4/10

Publication date: July 31, 2025

Full Report

Author: Analystock.ai

📋 Highlights
  • Earnings Performance Q2 2025 operating earnings of $0.39 per share, exceeding expectations due to cost management and favorable timing.
  • Load Pipeline Growth Over 17 GW in the load pipeline, with an additional 16 GW expected to be formalized by year-end.
  • Investment Commitment $38 billion investment planned through 2028, with an additional $10-15 billion in potential transmission work.
  • Earnings Growth Outlook Projected annualized earnings growth rate of 5-7% through 2028, supporting long-term financial targets.
  • Financing Progress 80% of 2025 debt financing needs completed, including $725 million from ComEd and $650 million from BGE.

Regulatory Environment and Legislative Developments

Regulatory activity continues to shape Exelon's landscape, with Illinois considering energy omnibus legislation and discussions in Pennsylvania and New Jersey around utility ownership of generation. The capacity auction highlighted the need for proactive state measures to secure energy futures. Exelon is advocating for policies that provide certainty, state control, and customer benefits, as evident in their discussions around Maryland's legislation requesting 3,000 megawatts of power by October.

Growth Opportunities in Transmission and Generation

Exelon is positioned for significant growth, with over 17 gigawatts in its large load pipeline and an expected $1 billion in transmission work associated with MISO Tranche 2.1 projects. The company plans to invest $38 billion through 2028, with an additional $10 billion to $15 billion in transmission work identified beyond that. Exelon is open to building regulated or contracted generation, with a preference for regulated generation in partnership with states, providing certainty, control, and customer benefits.

Financial Flexibility and Financing Plans

Exelon has completed nearly 80% of its planned long-term debt financing needs for 2025, with ComEd and BGE issuing significant amounts. They have also priced the full $700 million of planned equity needs for 2025 via their ATM. The company's financial flexibility is projected to be 100 to 200 basis points above the Moody's downgrade threshold, approaching 14% at the end of the guidance period. With a Net Debt / EBITDA ratio of 6.6, Exelon's leverage is relatively high, but manageable given its stable cash flows.

Valuation and Outlook

With an ROE of 9.76% and an EV/EBITDA ratio of 12.78, Exelon's valuation appears reasonable. The company's earnings growth is expected at an annualized rate of 5% to 7% through 2028, driven by its significant investment plans and growth opportunities in transmission and generation. As the company continues to navigate the regulatory environment and capitalize on growth opportunities, investors can expect a stable return, supported by the 3.47% dividend yield.

Exelon's A-Score