EXELON CORPORATION (EXC): what the price assumes

boothcheck covers EXELON CORPORATION (EXC) but does not put one priced-in number on it: here the defensible answer is the evidence rather than a point estimate. boothcheck publishes no house fair value, target price, or buy/sell rating. Narrative composed 2026-07-26.

Generated: 2026-08-30 · Source: https://boothcheck.com/report/EXC

Headline

FieldValue
TickerEXC
CompanyEXELON CORPORATION
Sector / IndustryUtilities
Current price$43.90/sh
CompositionComEd 30% / PECO 19% / BGE 21% / Pepco 14% / DPL 8% / ACE 7%

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Multiple paid18x operating income

The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.

Solve inputs: computed at a 5.5% cost of capital with 4% terminal growth over a 5-year stage (computed at the 5.5% minimum rate; the CAPM rate 5.2% sits below it).

How unusual the bet is: within-range (limited comparison data)

ReferenceValue
vs own history-0.37σ
cohort percentile (of 70 peers)31

Valuation X-Ray

Every valuation family lands below the price. The price therefore sits beyond what those standard frames encode.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.48x5expensive
Earnings1.89x3expensive
Relative2.89x2expensive
Growth1.44x3expensive

Families that call it expensive: Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.6%); the inversion above states its own rate.

Per-Model Detail (n=13)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$193.090.23xyesReference only (OCF-based, capex excluded): OCF $6.8B
DCF Exit MultipleGrowth$0.00—noNegative/zero FCF or EBITDA — equity value floored at $0
Relative ValuationRelative——noP/E 20x (static sector reference · 2026-04), scenarios: 16.7x / 20.0x / 23.3x (bear / base = reference held flat / bull), EV/EBITDA 13x
Simple DDMGrowth——no—
Two-Stage DDMGrowth$28.821.52xyesStage 1: 2% for 5yr, Stage 2: 3.5% perpetual
Simple Excess ReturnAsset$29.371.49xyesBV/sh $28.66, ROE (TTM) 9.5%, ke 9.3%
Two-Stage Excess ReturnAsset$29.721.48xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$30.531.44xyesRev $24.8B, growth 4% (input: historical growth; tapered), Terminal P/S: 1.5x / 1.8x / 2.1x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$25.801.70xyesEPS $2.15, growth 2% (input: historical EPS growth), PEG=6.79 (Overvalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$2.5517.22xyesNormalized EBIT (5y avg op income, one-time charges added back) $4.05B × (1−18%) / WACC 6.6% → EPV (no growth)
Residual IncomeAsset$29.791.47xyesBV $28.66 + 5yr PV of (ROE (TTM) 9.5% − Kₑ 9.3%) × BV; BV grows 6.2%/yr
Graham NumberAsset$37.231.18xyes√(22.5 × EPS $2.15 × BVPS $28.66) — Graham's conservative floor
EV/EBITDA RelativeRelative——noEBITDA $6.01B × sector EV/EBITDA 13.0x
FCF YieldEarnings——no—
SBC-Adj FCF YieldEarnings——no—
Ben Graham FormulaEarnings$23.901.84xyesEPS $2.15 × (8.5 + 2×2.4%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$7.445.90xyesBV $28.66 × (ROIC 1.7% / WACC 6.6%)
P/Sales SectorRelative——noRevenue $24.79B × sector P/S 2.5x
PEG Fair ValueRelative$10.754.08xyesEPS $2.15 × (PEG 1.5 × growth 2.4% (input: historical EPS growth)) → PE 3.6x
Earnings YieldEarnings$23.241.89xyesEPS $2.15 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

UnitRoleValuation basisRevenueReported profitValue evidenceStatus
ComEdoperatingenterprise$7.3b—withheldunresolved no unit value
PECOoperatingenterprise$4.7b—withheldunresolved no unit value
BGEoperatingenterprise$5.2b—withheldunresolved no unit value
Pepcooperatingenterprise$3.5b—withheldunresolved no unit value
DPLoperatingenterprise$2.0b—withheldunresolved no unit value
ACEoperatingenterprise$1.7b—withheldunresolved no unit value

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

FieldValue
Net debt$49.6b
Net debt / NOPAT (after-tax)11.59x
Net debt / operating income (pre-tax)9.52x
Share count CAGR (dilution)1.1%
Burning cashno

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

Bull Case

A multiple of trailing earnings tells you very little about a company shaped like this one, and a leverage ratio tells you almost nothing at all. Exelon does not compete for customers in any ordinary sense. It owns the poles, wires and pipes that deliver energy across six service territories, and state commissions and the federal regulator decide what it may charge, based on the capital it has invested and a return they authorize on that capital. Earnings here are not won in a market. They are awarded in a proceeding. Once that clicks, the borrowings on the balance sheet stop reading as danger and start reading as raw material, because borrowing is how the invested base gets built and the invested base is the only thing that generates income.

The mechanic is stated openly in the filings. The 10-K says the utilities "anticipate investing approximately $41 billion over the next four years in electric and natural gas infrastructure improvements and modernization projects, including smart grid technology, storm hardening, advanced reliability technologies, new business including data centers, and transmission projects, which is projected to result in an increase to current rate base of approximately $23 billion by the end of 2029." By May 2026 the company had revised that plan up, to $41.7 billion, and put the resulting invested-base growth at 7.9% a year. For a business whose income is a permitted return on invested capital, that growth rate is the growth rate. Everything else is weather and timing.

There is a second feature that most investors miss because it sounds like bookkeeping. Some of the authorized returns move with interest rates rather than against them. The 10-K describes one ComEd revenue requirement carrying "an allowed ROE of 10.21 %, reflecting the monthly average yields for 30-year treasury bonds plus 580 basis points". Read that slowly. When long rates rise, the return the utility is permitted to earn rises with them. Most businesses meet higher rates as a pure cost. This one meets them, in part, as a revenue formula.

The reported results show the machine working. For 2025 Exelon reported total operating revenues of $24,258 million and operating income of $5,148 million, against $4,319 million of operating income in 2024 and $4,023 million in 2023. Net income attributable to common shareholders was $2,768 million for 2025, up from $2,460 million. ComEd alone lifted operating income to $1,806 million from $1,589 million, which the filing attributes to higher distribution and transmission rate base from incremental investment. In the first quarter of 2026 operating revenues were $7,242 million and operating income $1,605 million, against $6,714 million and $1,536 million a year earlier.

Set against the utilities it is measured with, the profitability is respectable rather than exceptional, and for this business model that is the point. AEP converts 24.2% of revenue into operating profit and ED converts 17.2%; Exelon's 2025 figure sits between them, and PCG at 19.4% is in the same neighborhood. What separates a good regulated utility from a mediocre one is not margin but whether it can keep deploying capital that commissions agree to compensate. The dividend record suggests management believes it can: $1.44 a share declared for 2023, $1.52 for 2024, $1.60 for 2025.

Bear Case

Here is the structural truth a holder has to sit with. This company cannot grow earnings by selling more or by charging what it likes. It grows them by spending money it does not have, on assets a commission later decides whether to let it earn a return on. In 2025 Exelon paid $1,617 million of common dividends out of $2,768 million of net income and, in the same year, issued $691 million of new stock. Money left through one door and came back in through another. The share count has risen in each of the last three years, from 1,001 million at the end of 2023 to 1,007 million and then 1,024 million at the end of 2025, and management has told investors that $3.4 billion of equity remains to be raised through 2029. Dilution is not a risk to the plan. It is a line item in it.

The commission is not a rubber stamp, and there is a documented instance of that. On December 14, 2023 the Illinois Commerce Commission rejected ComEd's 2024-2027 grid plan as non-compliant, set the utility's forecast revenue requirements off an older year-end invested base, and produced a cumulative revenue requirement increase of $501 million, some $986 million short of what ComEd had asked for. ComEd appealed in the Illinois Appellate Court over the authorized return on equity, a 50% equity ratio and the denial of a return on its pension asset, and the filing notes there is no deadline by which the court must rule. The 10-K states the dependency without decoration: the financial statements are "heavily dependent on the ability of the Utility Registrants to recover their costs associated with the retail purchase, transmission, and distribution of power and natural gas to their customers."

The bill for the capital plan does not vanish; it arrives at customers' homes. A four-year program of that size, in service territories that include Chicago, Philadelphia, Baltimore and Washington, lands as higher delivery charges on households already dealing with higher energy costs. The commissions that authorize returns are appointed and elected in those same jurisdictions. This is not a hypothetical political risk. It is the ordinary tension of the business, and it tends to bite hardest exactly when the investment program is largest, which is now.

Meanwhile the borrowings carry a real and growing claim on the operating line. Net interest expense was $2,102 million for 2025, up from $1,889 million in 2024 and $1,704 million in 2023. Against operating income of $5,148 million for the same year, roughly two fifths of the operating result goes to lenders before a shareholder sees anything. That share has been rising for three years while the capital plan calls for more borrowing, and although higher long rates eventually feed into authorized returns, they hit the interest line first and the revenue formula only after a proceeding.

None of which says the business breaks, and the bull is right that predictability is real here. The point is narrower. Every standard method used to triangulate a value reads this price as above what it reaches, and the price sits about two thirds above the book value of a company earning roughly 9.5% on that book, barely more than what an equity investor should require for holding it. What that gap is paying for is capital not yet spent, permissions not yet granted, and rates not yet approved. It is a reasonable bet. It is not a cheap one, and the arithmetic gives it very little room to be wrong.

Valuation

Every standard method here lands below the current price, which is unusual enough to be the starting point rather than a footnote. Asset-based approaches, earnings power, peer multiples and the growth-based approaches all reach numbers under where the stock trades. For most companies that pattern means a growth premium the static frames cannot capture. For a regulated wires business it means something narrower and more precise: the price is paying for capital that has not been spent yet.

That is the concrete version of what has to be true. The stock trades about two thirds above the book value of the enterprise, on a business earning roughly 9.5% on that book against a required return not far below it. A company earning about what its owners should demand, yet valued well clear of the capital sitting inside it, is being paid for the growth of that capital rather than the return on it. The capital plan is exactly that promise made explicit: $41.7 billion of spending across four years, targeting invested-base growth of 7.9% a year. If that growth arrives and commissions authorize returns on it, the premium is earned over time rather than at once. If it slips, there is nothing else in the numbers holding the level up.

A second reading of the same facts comes out gentler, and the difference between the two is worth naming because it is the actual disagreement. Charge this business the low cost of money that its regulated, rate-recovered structure implies, and the current level looks unremarkable for a company of this stability. Charge it the return an equity investor would demand of any company carrying this much borrowed capital and this much regulatory dependence, and it does not. Which of those is the right required return is the whole question, and no arithmetic settles it.

The reported inputs behind all of this are plain. Total operating revenues were $24,258 million for 2025 with operating income of $5,148 million, and net income attributable to common shareholders of $2,768 million. Net interest expense for the year was $2,102 million. The first quarter of 2026 brought operating revenues of $7,242 million and operating income of $1,605 million, against $6,714 million and $1,536 million in the same quarter of 2025. Nothing in that record is deteriorating; the revenue and the operating line both moved up.

Among the utilities it is grouped with, the profitability is mid-pack, which is the correct outcome for a business whose returns are set rather than competed for. AEP earns a 24.2% operating margin, EIX 30.8%, ED 17.2% and FE 14.7%; the 2025 Exelon figure sits in the middle of that spread. The balance sheet carries a great deal of borrowed money, as every wires business does, and the useful way to read it is not as distress but as the financing of an asset base that regulators have agreed to compensate. What that framing cannot do is make the capital plan optional, and it is the capital plan, not the current earnings, that the price is buying.

Catalysts

First quarter results arrived on May 6, 2026, and the operating news was quiet: GAAP net income of $0.90 a share, roughly level with the prior year. ComEd's GAAP net income rose to $310 million from $302 million and PECO's to $278 million from $266 million, with the filing attributing the improvement to approved distribution and transmission rates and to higher allowance for funds used during construction. The more consequential item was not the quarter at all. Management revised the four-year capital program up to $41.7 billion and put expected invested-base growth at 7.9% a year.

Financing that program is now a visible, dated process rather than an intention. By March 31 the company had completed roughly 43% of its planned borrowings for the year, including all issuance at the holding company, and had priced about 37% of the $3.4 billion of equity it expects to need through 2029. Watch the pace of that equity, because it is the clearest signal available of whether the plan is being funded on schedule and on what terms.

The regulatory calendar carries the rest of the risk and most of the potential relief. ComEd's appeal in the Illinois Appellate Court remains outstanding on the authorized return on equity, the equity ratio used to set rates, and whether it may earn a return on its pension asset, and the 10-K notes that no deadline binds the court. Separately, the Illinois multi-year plan runs an annual reconciliation, so each year's actual spending is trued up against approved revenue requirements with a lag. Those proceedings decide the return on the largest single piece of the company, and unlike a product launch they arrive without a schedule.

Peer Cohorts (Per Segment, With Filing Citations)

ComEd (reported)

PECO (reported)

BGE (reported)

Pepco / ACE (reported)

DPL (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Q1 2026 results release, May 6, 2026 · FY2025 Form 10-K

View the full interactive EXC report on boothcheck