28 Aug

PPL’s Current Valuation Compared to Its Peers

WRITTEN BY Vineet Kulkarni


PPL (PPL) stock is trading at a PE multiple of 13x—compared to its five-year historical valuation of 14x. The stock appears to be trading at a discounted valuation compared to its historical average. So far in 2018, PPL stock has fallen ~4%, while broader utilities (XLU) have risen ~7%.

PPL is trading at an EV-to-EBITDA multiple below 10x. The company’s historical average is close to 11x. PPL appears to be attractively valued considering its EV-to-EBITDA multiple.

PPL’s Current Valuation Compared to Its Peers

PPL’s forward PE multiple is ~12x, while Duke Energy’s (DUK) PE multiple is beyond 16x. Xcel Energy’s (XEL) forward PE multiple is close to 19x, while Southern Company’s (SO) forward PE multiple is 15x.

Recently, Southern Company stock was volatile due to its power plant issues. Southern Company reported yet another cost increase at Plant Vogtle. To learn more, read Utilities’ Weekly Review: Utilities in the Week Ending August 24.

PPL’s current dividend yield of 5.6% is way higher than utilities’ average. Next, we’ll discuss PPL’s dividend profile.

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