Constellation Energy Corporation (CEG) AI Stock Analysis

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Constellation Energy Corporation

(NASDAQ:CEG)

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Neutral 65 (OpenAI - 4o)

Rating:65Neutral

Price Target:

$345.00

▲(4.26% Upside)

Constellation Energy Corporation's overall score is driven by strong earnings call highlights, including strategic acquisitions and clean energy agreements, which are supported by political backing. However, financial performance is hindered by cash flow challenges and declining margins. The technical analysis and valuation suggest caution due to potential bearish momentum and high valuation.

Positive Factors

Strategic Acquisitions

The acquisition of Calpine enhances Constellation's market position and operational capacity, supporting long-term growth and competitive advantage in the energy sector.

Clean Energy Agreements

Long-term agreements with major corporations like Meta provide stable revenue streams and reinforce Constellation's commitment to sustainable energy solutions, bolstering its market reputation.

Political Support for Nuclear

Strong political backing for nuclear energy ensures regulatory support and potential financial incentives, enhancing Constellation's ability to expand its nuclear energy operations.

Negative Factors

Cash Flow Challenges

Persistent cash flow issues may hinder Constellation's ability to invest in growth opportunities and meet financial obligations, impacting long-term financial stability.

Declining Margins

Shrinking margins suggest cost pressures or pricing challenges, which could erode profitability and competitiveness if not addressed.

Regulatory Uncertainties

Regulatory uncertainties can affect market dynamics and pricing, posing risks to Constellation's strategic planning and revenue predictability.

Constellation Energy Corporation (CEG) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$103.38B

Dividend Yield0.46%

Average Volume (3M)2.11M

Price to Earnings (P/E)33.7

Beta (1Y)1.69

Revenue Growth13.41%

EPS Growth27.49%

CountryUS

Employees14,215

SectorUtilities

Sector Strength65

IndustryRenewable Utilities

Share Statistics

EPS (TTM)1.91

Shares Outstanding312,405,580

10 Day Avg. Volume2,328,379

30 Day Avg. Volume2,110,813

Financial Highlights & Ratios

PEG Ratio0.14

Price to Book (P/B)5.35

Price to Sales (P/S)2.99

P/FCF Ratio-14.01

Enterprise Value/Market Cap1.04

Enterprise Value/Revenue4.35

Enterprise Value/Gross Profit21.01

Enterprise Value/Ebitda16.90

Forecast

1Y Price Target

$377.30

Price Target Upside14.02% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

Constellation Energy Corporation Business Overview & Revenue Model

Company DescriptionConstellation Energy Corporation generates and sells electricity in the United States. The company operates through five segments: Mid-Atlantic, Midwest, New York, ERCOT, and Other Power Regions. It sells natural gas, renewable energy, and other energy-related products and services. The company has 32,400 megawatts of generating capacity consisting of nuclear, wind, solar, natural gas, and hydroelectric assets. It serves distribution utilities; municipalities; cooperatives; and commercial, industrial, governmental, and residential customers. The company was incorporated in 2021 and is headquartered in Baltimore, Maryland. Constellation Energy Corporation was formerly a subsidiary of Exelon Corporation.

How the Company Makes MoneyConstellation Energy generates revenue through multiple key streams. The primary source is the sale of electricity generated from its power plants, which include nuclear, solar, wind, and natural gas facilities. The company also earns money by providing energy supply services to residential and commercial customers, offering fixed and variable pricing plans. Additionally, Constellation engages in wholesale energy trading, buying and selling power in competitive markets to optimize its energy portfolio. The company's revenue is further supported by long-term contracts with various customers and utilities, as well as partnerships with businesses and governmental entities focused on sustainability initiatives. These diverse revenue streams, combined with strategic investments in renewable energy, enable Constellation Energy to maintain a stable financial foundation.

Constellation Energy Corporation Key Performance Indicators (KPIs)

Any

Nuclear Generation by Geography

Nuclear Generation by Geography
Maps out nuclear energy production across various locations, reflecting the company's commitment to stable, low-carbon power generation and its strategic positioning in different regulatory environments.

Chart InsightsConstellation Energy's nuclear generation in ERCOT has seen a notable increase since late 2023, reflecting strategic expansion efforts. This aligns with the company's focus on leveraging its clean energy assets to support data center demand, as highlighted in the recent earnings call. The Midwest and Mid-Atlantic regions show stable generation, while New York experiences fluctuations. The company's strong operational performance and strategic acquisitions, like Calpine, are poised to enhance earnings, though regulatory challenges and market overestimation remain potential risks.

Data provided by:

Main Street Data

Constellation Energy Corporation Earnings Call Summary

Earnings Call Date:Aug 07, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 10, 2025

Earnings Call Sentiment Positive

The earnings call highlighted Constellation Energy's strong financial performance, strategic acquisitions, and significant clean energy agreements, underpinned by robust political support for nuclear energy. However, challenges remain in regulatory and interconnection processes, affecting transaction timings and market stability.

Q2-2025 Updates

Positive Updates

Strong Financial Performance

Constellation Energy Corporation delivered second-quarter GAAP earnings of $2.67 per share and adjusted operating earnings of $1.91 per share, improving on last year's performance.

Share Buybacks Resumed

Following the Meta announcement, Constellation executed $400 million in Accelerated Repurchases, continuing to generate returns from stock repurchases.

Big Beautiful Bill Signed

The bill preserves and strengthens nuclear provisions, showcasing strong bipartisan support for nuclear energy.

Calpine Acquisition Progress

Received New York, Texas, and FERC approvals for the Calpine acquisition, on track to close by year-end.

Significant Clean Energy Agreements

Announced a 20-year power purchase agreement with Meta for the Clinton Clean Energy Center and a significant carbon-free energy transaction with Comcast.

Operational Excellence

Nuclear team posted its second-best fleet production ever with a capacity factor of 94.8%, producing over 41 million-megawatt hours of reliable, emissions-free power.

Support for Nuclear Energy

Political support for nuclear energy continues, with the extension of nuclear credits and executive orders signed to expand nuclear power.

Illinois ZEC Program Benefits

Recognized $201 million from the Illinois ZEC Program for bank credits, similar to the previous year.

Negative Updates

Interconnection Challenges

Delays and complexities in interconnection processes with utilities affecting the timing of new transactions.

Regulatory and Market Uncertainties

Uncertainties in the regulatory framework, including PJM market design changes and their impact on capacity auction pricing.

Capacity Auction Limitations

Demand response participation limited by low electric load carrying capacity (ELCC), affecting auction results.

Data Center Cost Concerns

Data center customers finding utility requirements for interconnection contracts onerous, impacting their operations.

Company Guidance

During the Constellation Energy Corporation's second-quarter earnings call, several key metrics and forward-looking statements were highlighted. The company reported GAAP earnings of $2.67 per share and adjusted operating earnings of $1.91 per share, marking an improvement over the previous year's second quarter. Constellation executed $400 million in accelerated stock repurchases following the Meta announcement, which was part of their strategy of securing long-term contracts. Additionally, they announced a 20-year power purchase agreement with Meta for over 1,100 megawatts of emissions-free nuclear energy, and they are advancing the restart of the Crane Clean Energy Center to the second half of 2027. The company also secured New York, Texas, and FERC approvals for the Calpine acquisition, expected to close by year-end. Furthermore, Constellation is actively pursuing additional agreements to sell clean, reliable megawatts from its nuclear plants, with one deal in late stages and others in earlier phases. The company noted strong bipartisan support for nuclear energy, bolstered by recent legislative developments, and emphasized the strategic advantage of combining gas and nuclear for competitive energy solutions.

Constellation Energy Corporation Financial Statement Overview

Summary

Constellation Energy Corporation shows solid revenue growth and profitability with a strong ROE and improved leverage. However, declining margins and cash flow challenges pose risks, necessitating improvements in cash flow generation for sustained growth.

Income Statement

Positive

Constellation Energy Corporation has shown consistent revenue growth with a TTM growth rate of 2.59%. The company maintains a healthy gross profit margin of 19.43% and a net profit margin of 11.88% in the TTM period. However, there is a noticeable decline in margins compared to the previous year, indicating potential cost pressures or pricing challenges.

Balance Sheet

Positive

The company's debt-to-equity ratio has improved to 0.62 in the TTM, reflecting better leverage management. Return on equity is strong at 23.08%, indicating effective use of equity to generate profits. However, the equity ratio of 25.36% suggests a moderate reliance on debt financing.

Cash Flow

Neutral

The cash flow situation is concerning, with negative free cash flow and a significant decline in free cash flow growth by 43.80% in the TTM. The operating cash flow to net income ratio is low at 0.07, indicating potential cash generation issues relative to reported earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.82B	23.57B	24.92B	24.44B	19.65B	17.60B
Gross Profit	5.14B	5.99B	3.30B	2.14B	2.75B	3.27B
EBITDA	6.39B	6.97B	4.22B	2.92B	3.81B	4.31B
Net Income	3.01B	3.75B	1.62B	-160.00M	-205.00M	589.00M
Balance Sheet
Total Assets	53.04B	52.93B	50.76B	46.91B	48.09B	48.09B
Cash, Cash Equivalents and Short-Term Investments	2.06B	3.02B	368.00M	422.00M	504.00M	226.00M
Total Debt	8.31B	8.41B	9.26B	5.77B	8.20B	7.21B
Total Liabilities	39.23B	39.39B	39.47B	35.54B	36.47B	33.42B
Stockholders Equity	13.45B	13.17B	10.93B	11.02B	11.22B	12.40B
Cash Flow
Free Cash Flow	-2.40B	-5.03B	-7.72B	-4.04B	-2.67B	-1.16B
Operating Cash Flow	456.00M	-2.46B	-5.30B	-2.35B	-1.34B	584.00M
Investing Cash Flow	3.02B	7.43B	3.03B	3.10B	3.28B	1.96B
Financing Cash Flow	-1.80B	-2.29B	2.20B	-799.00M	-1.70B	-2.66B

Constellation Energy Corporation Technical Analysis

Technical Analysis Sentiment

Positive

Last Price330.90

Price Trends

50DMA

322.26

Positive

100DMA

308.15

Positive

200DMA

278.17

Positive

Market Momentum

MACD

1.44

Negative

RSI

59.35

Neutral

STOCH

75.20

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CEG, the sentiment is Positive. The current price of 330.9 is above the 20-day moving average (MA) of 314.83, above the 50-day MA of 322.26, and above the 200-day MA of 278.17, indicating a bullish trend. The MACD of 1.44 indicates Negative momentum. The RSI at 59.35 is Neutral, neither overbought nor oversold. The STOCH value of 75.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CEG.

Constellation Energy Corporation Risk Analysis

Constellation Energy Corporation disclosed 1 risk factors in its most recent earnings report. Constellation Energy Corporation reported the most risks in the "Legal & Regulatory" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Constellation Energy Corporation Peers Comparison

Overall Rating

UnderperformOutperform

Sector (66)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VST	77 Outperform	71.59B	33.34	47.74%	0.42%	46.90%	388.66%
DUK	71 Outperform	94.15B	19.68	9.50%	3.47%	4.07%	9.94%
NEE	68 Neutral	146.37B	24.67	11.65%	3.12%	18.80%	-6.73%
CEG	65 Neutral	$103.38B	33.68	24.20%	0.46%	13.41%	27.49%
CWEN.A	61 Neutral	5.63B	41.59	4.11%	6.51%	-0.27%	-16.25%
BEPC	48 Neutral	6.06B	-4.59	-1174.68%	4.37%	12.46%	-388.89%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%

* Utilities Sector Average

Performance Comparison

CEG

Constellation Energy Corporation

330.90

75.32

29.47%

DUK

Duke Energy

121.08

7.96

7.04%

NEE

NextEra Energy

71.08

-11.18

-13.59%

VST

Vistra Energy

211.28

100.28

90.34%

CWEN.A

Clearway Energy

26.72

0.57

2.18%

BEPC

Brookfield Renewable

33.76

4.19

14.17%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 11, 2025