Download PDF

1. Company Snapshot

1.a. Company Description

Duke Energy Corporation, together with its subsidiaries, operates as an energy company in the United States.It operates through three segments: Electric Utilities and Infrastructure, Gas Utilities and Infrastructure, and Commercial Renewables.The Electric Utilities and Infrastructure segment generates, transmits, distributes, and sells electricity in the Carolinas, Florida, and the Midwest; and uses coal, hydroelectric, natural gas, oil, renewable generation, and nuclear fuel to generate electricity.


It also engages in the wholesale of electricity to municipalities, electric cooperative utilities, and load-serving entities.This segment serves approximately 8.2 million customers in 6 states in the Southeast and Midwest regions of the United States covering a service territory of approximately 91,000 square miles; and owns approximately 50,259 megawatts (MW) of generation capacity.The Gas Utilities and Infrastructure segment distributes natural gas to residential, commercial, industrial, and power generation natural gas customers; and owns, operates, and invests in pipeline transmission and natural gas storage facilities.


It has approximately 1.6 million customers, including 1.1 million customers in North Carolina, South Carolina, and Tennessee, as well as 550,000 customers in southwestern Ohio and northern Kentucky.The Commercial Renewables segment acquires, owns, develops, builds, and operates wind and solar renewable generation projects, including nonregulated renewable energy and energy storage services to utilities, electric cooperatives, municipalities, and corporate customers.It has 23 wind, 178 solar, and 2 battery storage facilities, as well as 71 fuel cell locations with a capacity of 3,554 MW across 22 states.


The company was formerly known as Duke Energy Holding Corp.and changed its name to Duke Energy Corporation in April 2005.The company was founded in 1904 and is headquartered in Charlotte, North Carolina.

Show Full description

1.b. Last Insights on DUK

Duke Energy's recent stock performance can be attributed to strong Q4 earnings, beating estimates by $0.05 per share, and solid guidance. The company's ability to generate $1.66 per share in earnings, up from $1.51 per share in the prior year, is a positive indicator. Additionally, Duke Energy's consistent execution and growing cash flows have supported its share buyback program, which reduces outstanding shares and boosts earnings per share. These factors have likely contributed to the company's resilience in a challenging market environment.

1.c. Company Highlights

2. Duke Energy's Strong Q3 Earnings Driven by Electric Utilities Growth

Duke Energy reported adjusted earnings per share of $1.81 for the third quarter, surpassing estimates of $1.76. The company's financial performance was driven by growth in its electric utilities segment. Although the exact revenue figure wasn't specified, analysts estimate next year's revenue growth at 3.2%, indicating a steady increase in the company's top line. With a P/E Ratio of 19.27 and an EV/EBITDA of 6.72, Duke Energy's valuation appears reasonable, considering its stable earnings growth prospects.

Publication Date: Nov -08

📋 Highlights
  • Strong Q3 adjusted EPS growth:: Achieved $1.81, driven by electric utilities, with full-year guidance narrowed to $6.25–$6.35.
  • 5-year capital investment surge:: $95B–$105B allocated for 13+ GW generation capacity expansion and transmission upgrades.
  • Economic impact of investments:: $370B in output and $200B GDP contribution projected for communities over the investment period.
  • Data center growth momentum:: 3 GW of signed electric service agreements in 2025, securing long-term revenue and infrastructure demand.
  • Balanced capital structure target:: 15% FFO-to-debt ratio by 2029, bolstered by 2026 proceeds from Tennessee/Florida transactions.

Investment Plan and Capital Allocation

Duke Energy is investing heavily in a generation build, planning to add over 13 gigawatts of capacity to its system in the next 5 years. The company's 5-year capital plan is expected to be between $95 billion and $105 billion, driven by the need to invest in transmission and generation for new data centers, as well as LDC investments and T&D investments. This significant investment is expected to have a substantial economic impact, with an estimated $370 billion in economic output and over $200 billion in GDP contribution to the communities it serves.

Economic Development and Growth Prospects

Duke Energy's economic development pipeline is maturing, with approximately 3 gigawatts of signed electric service agreements with data centers in 2025. The company has developed new teams and implemented creative solutions to accelerate the time to power, yielding tangible results. With a focus on credible hyperscalers and third-party developers, Duke Energy has signed 3 gigawatts of ESAs in the last 6 months, positioning the company for strong growth.

Balance Sheet and Funding Plan

Duke Energy is committed to its balance sheet, targeting 15% FFO to debt over the long term and expecting to exceed 14% this year. The company's funding plan includes 30% to 50% equity, depending on project velocity and recovery, with the lower end of the range driven by investments with faster recovery. With a Net Debt / EBITDA ratio of 0.61, Duke Energy's balance sheet appears healthy, supporting its growth prospects.

Growth Outlook and Valuation

Duke Energy expects to be at the high end of its 5% to 7% earnings growth range starting in 2028, driven by incremental capital investments and large-load customers coming online. With a Dividend Yield of 3.4% and a Free Cash Flow Yield of 9.32%, the company's valuation appears attractive, considering its stable earnings growth prospects and commitment to returning capital to shareholders.

3. NewsRoom

Card image cap

Duke Energy applauds Department of Energy's new nuclear investments, helps advance deployment of SMRs in the U.S.

Dec -04

Source: prnewswire.com

Card image cap

If You Think a Selloff Is Near, Grab Some Insurance with These 3 Stocks

Dec -04

Source: 247wallst.com

Card image cap

AI needs power desperately. Here's how to invest in companies profiting from the pain.

Dec -03

Source: marketwatch.com

Card image cap

How Is Duke Energy Using Energy Storage to Build a More Reliable Grid?

Dec -02

Source: zacks.com

Card image cap

DUK Stock Underperforms Industry in 6 Months: Here's How to Play

Dec -01

Source: zacks.com

Card image cap

Constellation Energy vs. Duke Energy: Which Stock Shines Brighter?

Nov -26

Source: zacks.com

Card image cap

Boston Research & Management Inc. Purchases 1,128 Shares of Duke Energy Corporation $DUK

Nov -23

Source: defenseworld.net

Card image cap

Duke Energy proposes new investments in North Carolina to boost reliability and support economic growth across the state

Nov -20

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.77%)

6. Segments

Electric Utilities and Infrastructure

Expected Growth: 4.8%

Duke Energy’s growth is driven by increasing focus on renewable energy, grid modernization, and expanding its natural gas infrastructure, which will support a steady growth rate in the coming years.

Gas Utilities and Infrastructure

Expected Growth: 4.1%

Duke Energy's natural gas segment is expected to grow due to increasing demand for clean energy, infrastructure expansion, and strategic acquisitions in the southeastern United States.

Other

Expected Growth: 8.5%

Duke Energy’s Other segment is expected to grow driven by increasing demand for renewable energy and energy storage, as well as government incentives and regulations supporting the transition to a low-carbon economy.

Eliminations

Expected Growth: 4.1%

Duke Energy's Eliminations segment growth is driven by increasing focus on cost optimization, streamlined operations, and a shift towards renewable energy sources, leading to improved efficiency and reduced inter-segment transactions.

7. Detailed Products

Electricity

Duke Energy generates, transmits, distributes, and sells electricity to retail and wholesale customers in the southeastern and midwestern United States.

Natural Gas

Duke Energy distributes and sells natural gas to retail customers in Ohio and Kentucky.

Renewable Energy

Duke Energy develops, owns, and operates renewable energy projects, including wind and solar farms, to generate electricity.

Energy Storage

Duke Energy offers energy storage solutions to help customers manage energy usage and reduce peak demand.

Grid Modernization

Duke Energy invests in grid modernization initiatives to improve the reliability, efficiency, and sustainability of the electric grid.

Energy Efficiency

Duke Energy offers energy efficiency programs and services to help customers reduce energy consumption and lower their energy bills.

8. Duke Energy Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Duke Energy Corporation operates in a highly regulated industry, and the threat of substitutes is moderate. While there are alternative energy sources available, the cost and convenience of traditional energy sources make them more attractive to customers.

Bargaining Power Of Customers

Duke Energy Corporation has a large customer base, but individual customers have limited bargaining power due to the lack of alternative energy providers in the market.

Bargaining Power Of Suppliers

Duke Energy Corporation relies on a diverse range of suppliers for fuel, equipment, and services. While suppliers have some bargaining power, the company's large scale of operations and diversified supply chain mitigate this risk.

Threat Of New Entrants

The energy industry has high barriers to entry, including significant capital requirements, regulatory hurdles, and infrastructure costs. This limits the threat of new entrants in the market.

Intensity Of Rivalry

The energy industry is highly competitive, with several large players competing for market share. Duke Energy Corporation faces intense rivalry from other energy companies, which can lead to pricing pressures and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 61.73%
Debt Cost 4.12%
Equity Weight 38.27%
Equity Cost 6.22%
WACC 4.92%
Leverage 161.27%

11. Quality Control: Duke Energy Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
American Electric Power

A-Score: 6.9/10

Value: 5.7

Growth: 4.6

Quality: 6.8

Yield: 7.0

Momentum: 7.5

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
Edison

A-Score: 6.4/10

Value: 8.3

Growth: 5.3

Quality: 7.5

Yield: 9.0

Momentum: 1.0

Volatility: 7.3

1-Year Total Return ->

View Full Report
Stock-Card
Duke Energy

A-Score: 6.4/10

Value: 5.5

Growth: 4.7

Quality: 4.6

Yield: 7.0

Momentum: 6.5

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
Southern

A-Score: 6.0/10

Value: 2.5

Growth: 4.8

Quality: 5.5

Yield: 7.0

Momentum: 6.5

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
ConEd

A-Score: 5.9/10

Value: 6.1

Growth: 4.2

Quality: 4.9

Yield: 7.0

Momentum: 3.0

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
PSEG

A-Score: 5.5/10

Value: 5.0

Growth: 3.8

Quality: 4.6

Yield: 6.0

Momentum: 3.5

Volatility: 10.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

117.97$

Current Price

117.97$

Potential

-0.00%

Expected Cash-Flows