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How Has Duke Energy Performed Recently?

Vineet Kulkarni - Author
By

Dec. 4 2020, Updated 10:50 a.m. ET

Duke Energy

Charlotte-based Duke Energy (DUK) is the second biggest utility holding company by market capitalization in the country. It generates more than 90% of its earnings from regulated operations, which gives it earnings predictability and stability. Duke Energy stock has rallied nearly 15% year-to-date, largely tracking broader utilities (XLU) (IDU).

Duke Energy has one of the most alluring dividend profiles among peers. You can read about it in Comparing Duke Energy’s Dividend Yield with Its Peers.

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Valuation

Duke Energy stock is currently trading at an EV-to-EBITDA valuation multiple of 12.5x against its five-year historical average of 11.0x. Utilities’ average valuation multiple presently stands around 11.0x. Consequently, Duke Energy stock seems to be trading at a fair premium compared to its historical average as well as the industry average.

Duke Energy’s forward EV-to-EBITDA ratio is around 11.0x. Its lower forward multiple compared to the current multiple implies expectations of higher EBITDA next year.

Price targets

According to Wall Street analyst consensus, Duke Energy stock has a mean price target of $88.7 against its current market price of $87.1. This indicates a possible gain of nearly 2% going forward.

Among the total 17 analysts tracking Duke, 12 analysts recommend it as a “hold.” One analyst rates the stock as a “strong buy,” while two rate it as a “buy.” Duke has one “sell” and one “strong sell” rating as of December 13, 2017.

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