CONSTELLATION ENERGY (CEG)
US21037T1097 - Common Stock
We assign a fundamental rating of 3 out of 10 to CEG. CEG was compared to 45 industry peers in the Electric Utilities industry. The financial health of CEG is average, but there are quite some concerns on its profitability. CEG is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
CEG had positive earnings in the past year.
CEG had a negative operating cash flow in the past year.
In multiple years CEG reported negative net income over the last 5 years.
In multiple years CEG reported negative operating cash flow during the last 5 years.
1.2 Ratios
CEG's Return On Assets of 3.20% is fine compared to the rest of the industry. CEG outperforms 68.89% of its industry peers.
CEG's Return On Equity of 14.86% is amongst the best of the industry. CEG outperforms 88.89% of its industry peers.
The Return On Invested Capital of CEG (2.23%) is worse than 86.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.2% | ||
| ROE | 14.86% | ||
| ROIC | 2.23% |
ROA(3y)0.81%
ROA(5y)1.19%
ROE(3y)3.86%
ROE(5y)4.93%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Profit Margin of CEG (6.51%) is worse than 75.56% of its industry peers.
In the last couple of years the Profit Margin of CEG has grown nicely.
With a Operating Margin value of 6.36%, CEG is not doing good in the industry: 88.89% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of CEG has grown nicely.
CEG has a worse Gross Margin (35.79%) than 60.00% of its industry peers.
In the last couple of years the Gross Margin of CEG has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.36% | ||
| PM (TTM) | 6.51% | ||
| GM | 35.79% |
OM growth 3Y64.55%
OM growth 5Y6.25%
PM growth 3Y24.86%
PM growth 5Y29.18%
GM growth 3Y-7.73%
GM growth 5Y-3.51%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CEG is destroying value.
The number of shares outstanding for CEG has been reduced compared to 1 year ago.
The debt/assets ratio for CEG is higher compared to a year ago.
2.2 Solvency
CEG has an Altman-Z score of 1.54. This is a bad value and indicates that CEG is not financially healthy and even has some risk of bankruptcy.
CEG's Altman-Z score of 1.54 is amongst the best of the industry. CEG outperforms 84.44% of its industry peers.
A Debt/Equity ratio of 0.84 indicates that CEG is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.84, CEG is in the better half of the industry, outperforming 64.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.84 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.54 |
ROIC/WACC0.26
WACC8.62%
2.3 Liquidity
CEG has a Current Ratio of 1.31. This is a normal value and indicates that CEG is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of CEG (1.31) is better than 73.33% of its industry peers.
CEG has a Quick Ratio of 1.08. This is a normal value and indicates that CEG is financially healthy and should not expect problems in meeting its short term obligations.
CEG has a Quick ratio of 1.08. This is in the better half of the industry: CEG outperforms 68.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.08 |
3. Growth
3.1 Past
CEG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 1120.41%, which is quite impressive.
The Earnings Per Share has been growing by 34.69% on average over the past years. This is a very strong growth
Looking at the last year, CEG shows a small growth in Revenue. The Revenue has grown by 1.96% in the last year.
The Revenue has been growing slightly by 4.04% on average over the past years.
EPS 1Y (TTM)1120.41%
EPS 3Y40.4%
EPS 5Y34.69%
EPS growth Q2Q-210%
Revenue 1Y (TTM)1.96%
Revenue growth 3Y12.28%
Revenue growth 5Y4.04%
Revenue growth Q2Q-20.96%
3.2 Future
Based on estimates for the next years, CEG will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.32% on average per year.
CEG is expected to show a very negative growth in Revenue. In the coming years, the Revenue will decrease by -11.18% yearly.
EPS Next Y49.66%
EPS Next 2Y25.72%
EPS Next 3Y16.64%
EPS Next 5Y12.32%
Revenue Next Year22.09%
Revenue Next 2Y13.73%
Revenue Next 3Y9.3%
Revenue Next 5Y-11.18%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 37.08 indicates a quite expensive valuation of CEG.
Based on the Price/Earnings ratio, CEG is valued a bit more expensive than 77.78% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 24.83, CEG is valued a bit more expensive.
A Price/Forward Earnings ratio of 24.78 indicates a rather expensive valuation of CEG.
Based on the Price/Forward Earnings ratio, CEG is valued expensively inside the industry as 82.22% of the companies are valued cheaper.
CEG's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.08 | ||
| Fwd PE | 24.78 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CEG is valued more expensive than 86.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 16.02 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CEG's earnings are expected to grow with 16.64% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.75
PEG (5Y)1.07
EPS Next 2Y25.72%
EPS Next 3Y16.64%
5. Dividend
5.1 Amount
With a yearly dividend of 0.73%, CEG is not a good candidate for dividend investing.
With a Dividend Yield of 0.73, CEG pays less dividend than the industry average, which is at 5.35. 88.89% of the companies listed in the same industry pay a better dividend than CEG!
With a Dividend Yield of 0.73, CEG pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
5.2 History
CEG has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
22.55% of the earnings are spent on dividend by CEG. This is a low number and sustainable payout ratio.
DP22.55%
EPS Next 2Y25.72%
EPS Next 3Y16.64%
CONSTELLATION ENERGY
NASDAQ:CEG (4/17/2024, 7:00:00 PM)
After market: 185.5 +0.1 (+0.05%)185.4
-1.25 (-0.67%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap58.42B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS NY rev (3m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.08 | ||
| Fwd PE | 24.78 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.75
PEG (5Y)1.07
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.2% | ||
| ROE | 14.86% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 6.36% | ||
| PM (TTM) | 6.51% | ||
| GM | 35.79% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.84 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.08 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)1120.41%
EPS 3Y40.4%
EPS 5Y
EPS growth Q2Q
EPS Next Y49.66%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)1.96%
Revenue growth 3Y12.28%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
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OCF growth 5Y