XCEL ENERGY INC (XEL): what the price assumes
In the published model solve dated 2026-Q2, anchored at $76.26, XCEL ENERGY INC (XEL) is priced for -1.9% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-03.
Generated: 2026-08-30 · Exported: 2026-08-31 · Source: https://boothcheck.com/report/XEL
Headline
| Field | Value |
|---|---|
| Ticker | XEL |
| Company | XCEL ENERGY INC |
| Current price | $76.26/sh |
| Composition | Residential 36% / C&I 46% / Other retail 1% / Wholesale 5% / Transmission 5% / Other (non-retail) 2% / Alternative revenue and other 6% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Implied growth | -1.9% |
| Multiple paid | 31x operating income |
Solve inputs: computed at a 5.7% cost of capital with 4% terminal growth over a 5-year stage.
How unusual the bet is: elevated (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | -1.56σ |
| cohort percentile (of 70 peers) | 94 |
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.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 1.97x | 5 | expensive |
| Earnings | 1.64x | 2 | expensive |
| Relative | 2.27x | 2 | expensive |
| Growth | 1.61x | 2 | expensive |
Families that call it expensive: Asset, Earnings, Relative, Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 5.4%); the inversion above states its own rate.
Per-Model Detail (n=11)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | — | — | no | Reference only (OCF-based, capex excluded): OCF $4.8B |
| DCF Exit Multiple | Growth | $0.00 | — | no | Negative/zero FCF or EBITDA — equity value floored at $0 |
| Relative Valuation | Relative | — | — | no | P/E 20x (static sector reference · 2026-04), scenarios: 16.7x / 20.0x / 23.3x (bear / base = reference held flat / bull), EV/EBITDA 18.34x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | $44.38 | 1.72x | yes | Stage 1: 5% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $38.65 | 1.97x | yes | BV/sh $38.51, ROE (TTM) 9.3%, ke 9.3% |
| Two-Stage Excess Return | Asset | $38.71 | 1.97x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $50.79 | 1.50x | yes | Rev $14.6B, growth 5% (input: historical growth; tapered), Terminal P/S: 2.7x / 3.3x / 3.8x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $43.80 | 1.74x | yes | EPS $3.65, growth 5% (input: historical EPS growth), PEG=4.27 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $0.01 | 7626.00x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $2.52B × (1−21%) / WACC 5.4% → EPV (no growth) (excluded from median) |
| Residual Income | Asset | $38.72 | 1.97x | yes | BV $38.51 + 5yr PV of (ROE (TTM) 9.3% − Kₑ 9.3%) × BV; BV grows 6.0%/yr |
| Graham Number | Asset | $56.24 | 1.36x | yes | √(22.5 × EPS $3.65 × BVPS $38.51) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | — | — | no | EBITDA $2.79B × sector EV/EBITDA 13.0x |
| FCF Yield | Earnings | — | — | no | — |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | $56.54 | 1.35x | yes | EPS $3.65 × (8.5 + 2×5.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $6.37 | 11.97x | yes | BV $38.51 × (ROIC 0.9% / WACC 5.4%) |
| P/Sales Sector | Relative | — | — | no | Revenue $14.62B × sector P/S 2.5x |
| PEG Fair Value | Relative | $27.33 | 2.79x | yes | EPS $3.65 × (PEG 1.5 × growth 5.0% (input: historical EPS growth)) → PE 7.5x |
| Earnings Yield | Earnings | $39.46 | 1.93x | yes | EPS $3.65 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Economic-Unit Decomposition (Sum Of The Parts)
Material operating units span distinct economics, so a single sector multiple or target margin is not representative. Consolidated cash-flow lenses may remain as secondary checks, while segment SOTP is primary.
| Unit | Role | Valuation basis | Revenue | Reported profit | Value evidence | Status |
|---|---|---|---|---|---|---|
| Regulated electric utility | operating | enterprise | $12.2b | $1.9b operating-income | $29.9b indicative EV subtotal | indicative enterprise value |
| Regulated natural gas utility | operating | enterprise | $2.5b | $256.0m operating-income | $4.1b indicative EV subtotal | indicative enterprise 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
| Field | Value |
|---|---|
| Net debt | $38.8b |
| Net debt / NOPAT (after-tax) | 17.60x |
| Net debt / operating income (pre-tax) | 13.90x |
| Interest coverage | 1.7x |
| Share count CAGR (dilution) | 3.5% |
| Burning cash | no |
Bullet Takeaways
The balance sheet tells you what kind of company this is: a regulated utility carrying about $36.6 billion of net debt to fund a $60 billion-plus capital plan, with management investing a record roughly $14 billion this year.
That spending is the growth engine. Q1 2026 ongoing EPS rose about 8% to $0.91, the company reaffirmed full-year guidance of $4.04 to $4.16, and it is targeting 6 gigawatts of data-center load by 2027, anchored by a Google agreement.
At $77.38 (as of June 27, 2026) the price sits at the very top of the utility peer multiple range, and the inversion reads it as embedding roughly 9% growth in the regulated electric segment. The unspoken risk is wildfire liability, where pending claims run into the hundreds of millions.
Bull Case
The balance sheet and the capital plan are the clearest window into how management sees the business, and the message is conviction. Xcel is executing a $60 billion-plus capital plan, invested more than $3 billion in the first quarter alone, and is on track for a record roughly $14 billion of capital spending this year. A regulated utility grows by putting capital into its rate base and earning an allowed return on it, so a plan of this size, funded with debt and equity, is management betting that demand and regulators will support years of rate-base expansion. The company reaffirmed 2026 ongoing EPS guidance of $4.04 to $4.16 after Q1 ongoing EPS rose about 8% year over year to $0.91, and it holds to a long-term target of 6% to 8% annual EPS growth.
The demand backdrop justifies the spending, and data centers are the standout. Management targets 6 gigawatts of data-center load under contract by 2027 and points to a landmark Google agreement as a model, one it says could save customers $1 billion to $1.5 billion over its term. Large-load growth from hyperscalers is the kind of demand a regulated utility rarely gets: it expands the rate base, spreads fixed costs over more sales, and is contracted for years. The filing describes grid and distribution investments including advanced grid infrastructure (FY2025 10-K, accession 0000072903-26-000009), the build-out that supports both the clean-energy transition and the new load.
The income profile is the foundation for a conservative holder. Xcel has raised its dividend for 23 consecutive years, recently lifting the quarterly payout about 4% to $0.5925 a share, an annual rate of $2.37 yielding roughly 3%, within a stated 45% to 55% payout target and a 4% to 6% growth goal. Combined with the EPS growth, management targets a total shareholder return above 10%. The valuation models that fit a regulated utility support the framework: the relative-multiple model lands near $47, the two-stage dividend-discount model near $50, and analysts have targets up to the high $80s and low $90s, with UBS at a Buy and an $89 target. For an investor who wants regulated, growing, inflation-linked income with a data-center growth kicker, the franchise and the plan are the attraction.
Bear Case
The truth a holder would rather not face is wildfire liability, and it is large, uncertain, and outside the rate-base growth story. Xcel operates utilities in fire-prone western states, and pending claims are material: the Smokehouse Creek Fire carries estimated losses around $430 million before insurance, with the potential to exceed the company's coverage, and a Texas Attorney General lawsuit against its Southwestern Public Service subsidiary remains active. The Marshall Wildfire settlement already cost about $0.03 a share in Q1 2026. The filing describes liability insurance with an annual premium of roughly $40 million covering property damage and bodily injury claims (FY2025 10-K, accession 0000072903-26-000009), and notes its loss accrual reflects settlements reached plus the low end of estimable remaining losses, subject to change as more information emerges (FY2025 10-K, accession 0000072903-26-000009). A single adverse verdict or a new fire season can produce a liability that dwarfs a year of earnings, and the market does not get to vote on the timing.
The valuation gives that risk no cushion. No valuation family reaches the price: it is rich on assets, earnings power, peers, and even forward growth, and the multiple sits at the very top of the regulated-utility peer distribution, well beyond the upper quartile. The static models land far below the $77 price, the simple excess-return model near $36, the residual-income model near $35, and the relative-multiple model near $47, because the trailing return on equity is only about 8.8%, below the cost of equity. The price is paying a premium multiple for the data-center growth narrative, and a utility priced at the top of its peer group has the most to lose if that narrative or the regulatory environment disappoints.
The leverage compounds both risks. Net debt of about $36.6 billion sits against trailing operating income, putting leverage near 14x with interest coverage of just 1.7x. That is heavy even for a capital-intensive utility, and it means the company must continuously raise external capital, with the share count growing about 3.5% a year, diluting existing holders, and with rising rates raising the cost of the debt that funds the plan. The physical-risk exposure the filing flags, extreme weather affecting both demand and grid stability (FY2025 10-K, accession 0000072903-26-000009), is the same exposure that drives the wildfire liability. A premium-priced, highly leveraged utility with an open-ended legal tail is a different risk than the steady-eddy reputation utilities carry, and the reverse-DCF reliability here is itself flagged as low.
Valuation
The inversion decomposes the price by segment, and the regulated electric utility carries the priced-in premium. At $77.38 the price implies operating growth of about 9.3% a year for five years in that segment, solved at a 6% cost of capital with 4% terminal growth, where each percentage point of cost moves the implied growth a large 12.9 points (a sensitivity that reflects the low discount rate). The model labels the assumption within range, but with an important qualifier: the multiple sits at the very top of the utility peer distribution, well beyond the upper quartile, so the stock is expensive relative to peers even if the absolute growth assumption is not heroic.
The static models reinforce that no standard frame reaches the price. The relative-multiple model at a 20x sector P/E lands near $47, the simple and two-stage excess-return models near $35 to $36, the residual-income model near $35, and the Graham number near $54, all below the $77 quote, because the trailing return on equity of about 8.8% runs below the cost of equity. The two-stage dividend-discount model lands near $50. The blended X-ray estimate sits near $44. Only the forward-growth lenses approach the price, which is why the characterization is that the price is rich on assets, earnings power, and peers.
The honest read is a high-quality regulated utility trading at a top-of-peer multiple, where the premium rests on the data-center-driven rate-base growth and the regulatory framework supporting it. Analyst targets in the high $80s to low $90s credit that growth; the static models are more cautious, and the gap between them is the premium a buyer pays for the growth narrative against a leveraged balance sheet and an open wildfire-liability question.
Catalysts
The Q1 2026 report was the recent catalyst: ongoing EPS rose about 8% to $0.91, just shy of the $0.93 estimate, and the company reaffirmed full-year guidance of $4.04 to $4.16. The next earnings report is a read on whether the capital plan stays on its record pace and whether weather-adjusted retail electric sales growth tracks the roughly 3% the guidance assumes. The cadence of rate-case decisions across Xcel's states is the steady catalyst, since each approval converts deployed capital into recoverable earnings.
The data-center pipeline is the catalyst with the most upside. Management targets 6 gigawatts of contracted load by 2027, and additional large-load agreements like the Google deal would extend the rate-base growth runway and validate the premium multiple. Capital return is a dependable positive: the dividend rose about 4% to a $0.5925 quarterly rate, the 23rd consecutive annual increase, within a 4% to 6% growth target. The dominant risk to watch is wildfire litigation: a resolution of the Smokehouse Creek Fire and the Texas Attorney General lawsuit on favorable terms would remove an overhang, while an adverse outcome or a new fire could impose losses in the hundreds of millions. Other risks are the heavy leverage and interest-rate sensitivity of the capital plan, ongoing equity issuance, and the simple fact that a top-of-peer multiple leaves little room for disappointment. Analyst targets reach the high $80s to low $90s on the growth case.
Sources: Investing.com: Xcel Q1 2026 $60B capital plan, data center growth; Seeking Alpha: Xcel targets 6 GW data center load, reaffirms EPS; StockTitan: XEL Q1 2026 EPS rises, guidance reaffirmed; 24/7 Wall St: UBS argues wildfire risks priced in, $89 target; Seeking Alpha: Xcel wildfires and surging electrical demand.
Peer Cohorts (Per Segment, With Filing Citations)
Regulated electric utility (reported)
- NEE (NextEra Energy Inc)
- FY2025 10-K: …Content s Regulated Operations Rate-Regulated Electric Transmission - As of December 31, 2025, certain entities within the NEER segment had ownership interests in rate-regulated electric transmission and related facilities. Jurisdiction Miles Substations Kilovolt Location Rate Regulator Ownership Actual/Expected…
- FY2025 10-K: …contracts, typically of less than three years duration, to hedge the price risk associated with selling into a daily spot market. Such bilateral contracts, which may be hedges either for physical delivery or for financial (pricing) offset, serve to protect a portion of the revenue that NEER expects to derive from the…
- DUK (DUKE ENERGY CORPORATION)
- FY2025 10-K: …goods and services in an amount that reflects consideration expected in exchange for those goods or services. Generally, the delivery of electricity and natural gas results in the transfer of control to customers at the time the commodity is delivered and the amount of revenue recognized is equal to the amount billed…
- FY2025 10-K: ElectricityUsRegulatedMember duk:CommercialMember duk:ProgressEnergyMember duk:ElectricUtilitiesandInfrastructureMember 2025-01-01 2025-12-31 0001326160 us-gaap:ElectricityUsRegulatedMember duk:CommercialMember duk:DukeEnergyProgressMember duk:ElectricUtilitiesandInfrastructureMember 2025-01-01 2025-12-31 0001326160…
- SO (SOUTHERN CO)
- FY2025 10-K: …for under various revenue accounting guidance, including revenue from contracts with customers, lease, derivative, and regulatory accounting. See Notes 4, 9, and 14 for additional information. Traditional Electric Operating Companies The majority of the revenues of the traditional electric operating companies are…
- FY2025 10-K: Regulatory Assets and Liabilities The traditional electric operating companies and the natural gas distribution utilities are subject to accounting requirements for the effects of rate regulation. Regulatory assets represent probable future revenues associated with certain costs that are expected to be recovered from…
- AEP (AMERICAN ELECTRIC POWER CO INC.)
- FY2025 10-K: . When regulatory assets are probable of recovery through regulated rates, assets are recorded on the balance sheets. Regulatory assets are reviewed for probability of recovery at each balance sheet date or whenever new events occur. Examples of new events include the issuance of a regulatory commission order or…
- FY2025 10-K: …the reliability of PSO's and SWEPCo's transmission systems. The TCA also provides for the allocation among the parties of revenues collected for transmission and ancillary services as determined by the FERC-approved OATT for SPP. Regional Transmission Organizations AEGCo, APCo, I&M, KGPCo, KPCo and WPCo are members…
- D (DOMINION ENERGY, INC)
- FY2025 10-K: …natural gas sales and related distribution services; • Regulated gas transportation and storage sales consists of sales of transportation services to off-system customers; • Other regulated revenue consists primarily of miscellaneous service revenue from electric and gas distribution operations and sales of excess…
- FY2025 10-K: …2025-01-01 2025-12-31 0000715957 d:VirginiaElectricAndPowerCompanyMember d:RiderSNAMember 2025-01-01 2025-12-31 utr:acre iso4217:EUR d:Project iso4217:USD utr:MWh d:Indicator iso4217:USD utr:MMBTU d:Counterparty d:Site d:Facility iso4217:USD xbrli:shares d:Program utr:T d:Agreement iso4217:USD d:Petition utr:kV…
- EXC (EXELON CORPORATION)
- FY2025 10-K: …September 2025 through February 2026 at a flat rate of $ 10 per residential customer. The bill credit and subsequent collections will not be subject to carrying costs. As of December 31, 2025, the Regulatory asset has a remaining balance of $ 10 million. Residential Universal Bill Credit (Exelon and ACE). In an…
- FY2025 10-K: …an increase in service application fees. Regulatory Required Programs represent revenues collected under approved riders to recover costs incurred for regulatory programs such as conservation, demand response, and the POLR mechanism. The riders are designed to provide full and current cost recovery, as well as a…
Regulated natural gas utility (reported)
- ATO (ATMOS ENERGY CORP)
- FY2025 10-K: …gas to the designated location. Revenue is recognized and our performance obligation is satisfied over time when natural gas is delivered to the customer. Management determined that these arrangements qualify for the invoice practical expedient for recognizing revenue. For demand fee arrangements, revenue is…
- FY2025 10-K: …authorities. Interruption and curtailment rights provide us the flexibility to meet the human-needs requirements of our customers on a reliable basis. Priority allocations imposed by federal and state regulatory agencies, as well as other factors beyond our control, may affect our ability to meet the demands of some…
- NI (NISOURCE INC.)
- FY2025 10-K: …related to unrecognized tax benefits. We have adopted this ASU on a retrospective basis in the income tax footnote 15, for the year ended December 31, 2025. 3. Revenue Recognition Customer Revenues. Substantially all of our revenues are tariff-based. Under ASC 606, the recipients of our utility service meet the…
- FY2025 10-K: …Center, IN Natural Gas 7,240,000 Rolling Prairie LNG Rolling Prairie, IN Liquified Natural Gas 4,000,000 Total Capacities 11,240,000 Competition. Similar to the Columbia Operations segment, NIPSCO Gas operates in an open and competitive market which allows retail customers to purchase gas directly from producers and…
- SWX (Southwest Gas Holdings, Inc.)
- FY2025 10-K: …Regulatory commissions have set up mechanisms that allow Southwest Gas to adjust customer rates to reflect fluctuations in natural gas cost. If the actual cost of gas differs from what is recovered through customer rates, the difference is recorded as a deferred amount. • If Southwest Gas has under-recovered costs,…
- FY2025 10-K: …setting rates (subject to conditions of the respective state tariffs) at levels competitive with commercially available alternative energy sources such as electricity and fuel oils. To address potential state policies surrounding electrification and reducing fossil fuels, Southwest Gas has taken steps to align with…
- SR (Spire Inc.)
- FY2025 10-K: …associated with off-system sales are satisfied, and revenue is recognized, at the point in time when the agreed upon volume of natural gas is delivered, and title is transferred, in accordance with the contract terms. The Utilities' transportation revenue relates to the promise to transport the specified quantities…
- FY2025 10-K: …from gas sales and transportation services on an accrual basis that includes estimated amounts for gas delivered but not yet billed. The accruals for unbilled revenues are reversed in the subsequent accounting period when meters are actually read and customers are billed. Spire Alabama records natural gas…
- NJR (NEW JERSEY RESOURCES CORPORATION)
- FY2025 10-K: …previously collected from customers. Decreases in the BGSS rate and BGSS refunds can be implemented with five days' notice to the BPU. Rate changes, as well as other regulatory actions related to BGSS, are discussed further in Note 4. Regulation in the accompanying Consolidated Financial Statements. Wholesale natural…
- FY2025 10-K: …that natural gas is delivered and consumed by customers, including an estimate for unbilled revenue. Natural gas sales to individual customers are based on meter readings, which are performed on a systematic basis throughout the month. At the end of each month, the amount of natural gas delivered to each customer…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
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.