Thinking of Investing in DUK? What Our Analysts Know.

Now trading at a price of $88.16, Duke Energy has moved -0.2% so far today.

Duke Energy returned losses of -7.0% last year, with its stock price reaching a high of $106.43 and a low of $83.06. Over the same period, the stock underperformed the S&P 500 index by -18.0%. As of April 2023, the company's 50-day average price was $89.57. Duke Energy Corporation, together with its subsidiaries, operates as an energy company in the United States. Based in Charlotte, NC, the large-cap Utilities company has 27,859 full time employees. Duke Energy has returned a 4.6% dividend yield over the last 12 months, but this may not be sustainable seen that the company has a choppy cash flow record.

The Company May Be Profitable, but Its Balance Sheet Is Highly Leveraged:

2018 2019 2020 2021 2022 2023
Revenue (MM) $24,521 $25,079 $23,366 $24,621 $28,768 $29,047
Gross Margins 19% 23% 20% 22% 21% 22%
Operating Margins 19.0% 23.0% 20.0% 22.0% 21.0% 22.0%
Net Margins 11.0% 15.0% 6.0% 16.0% 13.0% 13.0%
Net Income (MM) $2,666 $3,748 $1,377 $3,908 $3,778 $3,766
Net Interest Expense (MM) $2,094 $2,204 $2,097 $2,207 $2,439 $2,729
Depreciation & Amort. (MM) $4,696 $5,176 $5,486 $5,663 $5,843 $5,836
Earnings Per Share $3.77 $5.14 $1.87 $5.08 $4.91 $4.88
Diluted Shares (MM) 708 729 738 769 770 771
Free Cash Flow (MM) -$2,203 -$2,913 -$1,051 -$1,425 -$5,440 -$6,838
Capital Expenditures (MM) $9,389 $11,122 $9,907 $9,715 $11,367 $12,515
Net Current Assets (MM) -$29,529 -$34,667 -$36,709 -$33,154 -$34,233 -$32,655
Long Term Debt (MM) $51,123 $54,985 $55,625 $60,448 $65,873 $69,914
Net Debt / EBITDA 5.42 4.84 5.27 5.01 5.39 5.54

Duke Energy has weak revenue growth and increasing reinvestment in the business, decent operating margins with a stable trend, and positive EPS growth. However, Duke Energy has slimmer gross margins than its peers, an unconvincing cash flow history, and a highly leveraged balance sheet.

Duke Energy's Valuation Is in Line With Its Sector Averages:

Duke Energy has a trailing twelve month P/E ratio of 18.9, compared to an average of 22.89 for the Utilities sector. Based on its EPS guidance of $5.97, the company has a forward P/E ratio of 15.0. The company doesn't issue forward earnings guidance, and the compound average growth rate of its last 6 years of reported EPS is 4.4%. On this basis, the company's PEG ratio is 4.31, which suggests that it is overpriced. Furthermore, Duke Energy is likely overvalued compared to the book value of its equity, since its P/B ratio of 1.44 is higher than the sector average of 1.03. The company's shares are currently trading 6.3% above their Graham number.

Duke Energy Has an Average Rating of Buy:

The 16 analysts following Duke Energy have set target prices ranging from $91.0 to $120.0 per share, for an average of $98.31 with a buy rating. As of April 2023, the company is trading -8.9% away from its average target price, indicating that there is an analyst consensus of some upside potential.

Duke Energy has a very low short interest because 1.1% of the company's shares are sold short. Institutions own 65.1% of the company's shares, and the insider ownership rate stands at 0.12%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 9% stake in the company is worth $6,192,711,473.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.