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1. Company Snapshot

1.a. Company Description

Public Service Enterprise Group Incorporated, through its subsidiaries, operates as an energy company primarily in the Northeastern and Mid-Atlantic United States.It operates through two segments, PSE&G and PSEG Power.The PSE&G segment transmits electricity; distributes electricity and gas to residential, commercial, and industrial customers, as well as invests in solar generation projects, and energy efficiency and related programs; and offers appliance services and repairs.


As of December 31, 2021, it had electric transmission and distribution system of 25,000 circuit miles and 862,000 poles; 56 switching stations with an installed capacity of 39,353 megavolt-amperes (MVA), and 235 substations with an installed capacity of 9,285 MVA; four electric distribution headquarters and five electric sub-headquarters; and 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 58 natural gas metering and regulating stations.Public Service Enterprise Group Incorporated was incorporated in 1985 and is based in Newark, New Jersey.

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1.b. Last Insights on PEG

Public Service Enterprise Group Incorporated's recent performance was driven by robust Q2 2025 earnings, beating estimates with $0.77 per share, a 22% year-over-year increase. A strong gas sales and solid performance across segments contributed to the outperformance. Surging data center demand, with a 9.4 GW large-load inquiry pipeline, mostly tied to data centers, underscores a multi-year growth runway. The company's de-risked LIPA renewal and $6,400 MW pipeline provide high visibility and upside to EPS growth. A $0.63 per share dividend for Q3 2025 was also declared.

1.c. Company Highlights

2. PSEG's Earnings Beat Expectations with Strong Operational Performance

Public Service Enterprise Group Incorporated (PSEG) reported non-GAAP operating earnings of $0.72 per share for the fourth quarter, beating analyst estimates of $0.711. The company's full-year 2025 non-GAAP operating earnings were $4.05 per share, at the high end of the guidance range of $4.00 to $4.06 per share. Revenue growth was driven by a 1.8% reduction in the average monthly bill for PSE&G residential electric customers starting June 1, and a 7% increase in the rate base to approximately $36 billion at year-end 2025.

Publication Date: Feb -27

📋 Highlights
  • Net Income & Non-GAAP Earnings:: $0.63/share net income Q4 2025; $4.22/share full-year 2025; non-GAAP operating earnings $0.72/share Q4 and $4.05/share full-year.
  • Dividend Increase:: 2026 dividend rate raised to $2.68/share, a $0.16/share (6.3%) increase from prior guidance.
  • Capital Investment:: $3.7B spent in 2025; 2026 planned investment at $4.2B; 2026–2030 capex plan of $22.5–25.5B targeting 6–7.5% annual rate base growth.
  • Rate Base Growth:: Ended 2025 at $36B, 7% higher than 2024; projected 6–7.5% annual growth through 2030 driven by infrastructure investments.
  • Nuclear Hedging & Margin:: 95% of 2026 nuclear output hedged; gas margin increased $0.07/share in 2025 due to GSMP II and customer growth.

Operational Highlights

PSEG's appliance service business responded to nearly 2,000 no-heat calls per day during the fourth quarter, and the electrical systems performed well, with a comparatively small group of customers affected. The company invested approximately $1 billion during the fourth quarter, and for the full year 2025, capital spending totaled approximately $3.7 billion, with continued investments in infrastructure modernization, energy efficiency, and distribution reliability and resiliency investments supporting growing customer demand.

Guidance and Outlook

PSEG's 2026 guidance is based on the investment program at PSE&G and expected nuclear output realizing market prices that exceed the nuclear PTC threshold. The company is approximately 95% hedged for the remainder of 2026. The full-year 2026 non-GAAP operating earnings guidance is $4.28 to $4.40 per share, 7% higher at the midpoint over 2025 results. Analysts estimate next year's revenue growth at 4.1%.

Valuation

Based on the current stock price, the P/E Ratio is 20.28, and the Dividend Yield is 2.94%. The ROE is 12.6%, indicating a relatively stable return on equity. With a Net Debt / EBITDA ratio of 5.68, PSEG's debt levels appear manageable. As per Daniel J. Cregg, "We are proud to have delivered on meeting or exceeding our earnings guidance for the 21st year in a row." The current valuation metrics suggest that the market has priced in a relatively stable outlook for PSEG, with a moderate growth rate expected in the future.

Growth Prospects

PSEG's 2026 to 2030 regulated capital investment plan amounts to $22.5 to $25.5 billion, expected to produce a compounded annual growth in PSE&G's rate base of 6% to 7.5% through 2030. The company is well-positioned to benefit from its infrastructure modernization and energy efficiency investment program, with opportunities to contract existing output and planned uprates, as well as incremental regulated capital investment.

3. NewsRoom

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Cresset Asset Management LLC Grows Position in Public Service Enterprise Group Incorporated $PEG

Mar -10

Source: defenseworld.net

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8,935 Shares in Public Service Enterprise Group Incorporated $PEG Bought by 111 Capital

Mar -03

Source: defenseworld.net

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Public Service Enterprise Group Incorporated (NYSE:PEG) Receives Consensus Rating of “Moderate Buy” from Brokerages

Mar -02

Source: defenseworld.net

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Public Service Enterprise Group Inc (PEG) Q4 2025 Earnings Call Highlights: Strong Year-End Performance and Strategic Investments

Feb -26

Source: gurufocus.com

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Public Service Enterprise Group Incorporated (PEG) Q4 2025 Earnings Call Transcript

Feb -26

Source: seekingalpha.com

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PSEG (PEG) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates

Feb -26

Source: zacks.com

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PSEG (PEG) Tops Q4 Earnings and Revenue Estimates

Feb -26

Source: zacks.com

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PEG Q4 Earnings Surpass Estimates, Revenues Increase Y/Y

Feb -26

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.24%)

6. Segments

Public Service Electric and Gas Company (PSE&G)

Expected Growth: 2.0%

PSE&G's 2.0% growth is driven by increased electricity and gas demand, infrastructure investments, and rate base growth. The company's focus on grid modernization, renewable energy, and energy efficiency programs also contribute to its growth. Additionally, PSE&G's service territory expansion and customer base growth support its steady growth trajectory.

Pseg Power & Other

Expected Growth: 2.2%

PSEG Power & Other's 2.2% growth is driven by increased demand for electricity, favorable regulatory environment, and investments in clean energy technologies. The segment's growth is also supported by PSEG's focus on grid modernization and infrastructure upgrades, which enhance operational efficiency and reliability.

Eliminations

Expected Growth: 0.0%

The eliminations from Public Service Enterprise Group Incorporated with 0.0% growth are primarily driven by intersegment transactions and adjustments, which offset revenue and expenses. This stable growth suggests that the company's business segments are aligning well, with no significant fluctuations in operational performance or unusual accounting adjustments.

7. Detailed Products

Electricity Generation and Transmission

Public Service Enterprise Group Incorporated (PSEG) generates and transmits electricity to meet the energy demands of its customers. The company operates a fleet of power plants, including nuclear, gas, and renewable energy facilities.

Gas Distribution

PSEG provides natural gas distribution services to customers in its service areas. The company owns and operates a network of gas pipelines, storage facilities, and distribution infrastructure.

Energy Efficiency Services

PSEG offers a range of energy efficiency services, including energy audits, rebates for energy-efficient appliances, and energy-saving programs for businesses and homes.

Renewable Energy Solutions

PSEG offers renewable energy solutions, including solar and wind power, to customers who want to reduce their reliance on fossil fuels.

Energy Management Services

PSEG provides energy management services, including energy usage analysis, energy-saving recommendations, and energy management software.

8. Public Service Enterprise Group Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Public Service Enterprise Group Incorporated (PSEG) operates in the utility industry, which has a moderate threat of substitutes. While there are alternative energy sources, such as solar and wind power, the company's diversified portfolio and established customer base reduce the threat.

Bargaining Power Of Customers

PSEG's customers are primarily residential and commercial users who are not highly concentrated and have limited bargaining power. The company's regulated monopoly in certain areas also limits customer bargaining power.

Bargaining Power Of Suppliers

PSEG's suppliers include fuel providers, equipment manufacturers, and contractors. While the company has some negotiating power, suppliers also have some bargaining power due to the company's reliance on their inputs.

Threat Of New Entrants

The utility industry has high barriers to entry, including significant capital requirements, regulatory hurdles, and established relationships with customers and suppliers. This reduces the threat of new entrants.

Intensity Of Rivalry

The utility industry is moderately competitive, with several established players. However, PSEG's diversified portfolio and strong market position reduce the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 58.68%
Debt Cost 4.32%
Equity Weight 41.32%
Equity Cost 6.94%
WACC 5.40%
Leverage 142.04%

11. Quality Control: Public Service Enterprise Group Incorporated passed 4 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

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

82.31$

Current Price

82.31$

Potential

-0.00%

Expected Cash-Flows