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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 Q3 Earnings: A Strong Performance Amidst Growing Demand

PSEG reported a solid third quarter with non-GAAP operating earnings that beat analyst estimates, coming in at $1.13 per share compared to the expected $1.02 per share. The company's financial performance was driven by the positive impact of new rates from the October 2024 distribution rate case settlement. PSE&G, the utility segment, reported a significant increase in net income to $515 million in 2025 from $379 million in 2024, reflecting the company's continued investment in its infrastructure, with approximately $1 billion invested in the quarter and $2.7 billion over the first 9 months of 2025.

Publication Date: Nov -04

📋 Highlights
  • 2025 Earnings Guidance Raised: Narrowed to $4–$4.06/share (upper half of prior range of $3.94–$4.06).
  • Regulated Capital Investment: $2.7B invested YTD 2025 toward $3.8B annual plan, driven by PSE&G.
  • Nuclear Output & Efficiency: PSEG Nuclear supplied 7.9 TWh of carbon-free energy; Hope Creek extended fuel cycle to 24 months.
  • Balance Sheet Strength: Supports $22.5B–$26B 5-year capital program without new equity or asset sales.
  • Data Center Demand Surge: 11.5 GW large load pipeline (primarily data centers), with 2,800 mature applications.

Revenue Growth and Margin Analysis

The company's revenue growth is expected to continue, with analysts estimating a 4.3% increase in revenues for the next year. PSEG's ability to invest in its infrastructure while maintaining a strong balance sheet is expected to support its long-term growth prospects. As Ralph LaRossa mentioned, the company is willing to help the state achieve its goals in a regulated capacity, including gas generation, solar, and storage, which could provide additional opportunities for growth.

Valuation Metrics

Using the current valuation metrics, PSEG's P/E Ratio stands at 19.5, indicating that the stock may be fairly valued. The Dividend Yield is 3.06%, which is attractive for income-seeking investors. Additionally, the ROE is 12.59%, suggesting that the company is generating decent returns on equity. However, the Net Debt / EBITDA ratio is 5.99, which may indicate a relatively high level of debt.

Growth Opportunities and Challenges

PSEG is well-positioned to capitalize on the growing demand for energy, particularly from data centers, with a total of 11.5 gigawatts of large load inquiries. The company is working closely with policymakers to develop solutions to address the resource adequacy imbalance in New Jersey and the PJM region. As Ralph LaRossa stated, the company is focused on finding supply to meet growing demand and is analyzing the impact of various factors on its customer base.

Outlook and Conclusion

PSEG's strong financial performance and growth prospects are expected to continue, driven by its investments in infrastructure and its ability to capitalize on growing demand. The company's guidance for 2026 non-GAAP operating earnings is expected to be provided during the year-end call in February 2026, which will give investors further insight into its growth prospects. With a solid track record of delivering value to shareholders, PSEG remains an attractive investment opportunity in the utility sector.

3. NewsRoom

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Top 4 Low-PEG Value Stocks Ready to Outperform the Market

Dec -01

Source: zacks.com

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PSEG Gains Momentum Through Smart Investments and Clean Energy Plans

Nov -20

Source: zacks.com

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Alteri Wealth LLC Purchases 1,302 Shares of Public Service Enterprise Group Incorporated $PEG

Nov -19

Source: defenseworld.net

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En el Día de concientización sobre las estafas en los servicios públicos, PSEG Long Island exhorta a los clientes a "Tomarlo con calma. Verificar. Frenar la estafa".

Nov -19

Source: prnewswire.com

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PSEG Declares Regular Quarterly Dividend for the Fourth Quarter of 2025

Nov -18

Source: prnewswire.com

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Banco Bilbao Vizcaya Argentaria S.A. Sells 1,386 Shares of Public Service Enterprise Group Incorporated $PEG

Nov -18

Source: defenseworld.net

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PGIM Jennison Utility Fund Q3 2025 Performance Update

Nov -18

Source: seekingalpha.com

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On Utility Scam Awareness Day, PSEG Long Island Urges Customers to 'Slow Down. Verify. Stop the Scam.

Nov -17

Source: prnewswire.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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A-Score: 5.5/10

Value: 5.0

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Quality: 4.6

Yield: 6.0

Momentum: 3.5

Volatility: 10.0

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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

80.77$

Current Price

80.77$

Potential

-0.00%

Expected Cash-Flows