DUK - Duke Energy: Well-Positioned For Both Near And Long Term
2024-03-28 06:08:46 ET
Summary
- Under current conditions, Duke Energy presents a compelling investment opportunity with a good combination of value, income, and growth potential.
- Regulatory approvals and rate increases in North Carolina, Kentucky, Florida, and South Carolina are expected to support its growth in the next few years.
- Looking further out, DUK's capital project in renewable energy and strong financial position it well for long-term growth.
Near-term prospects
In this article, I will argue for a bullish thesis on Duke Energy ( DUK ) based on the growth catalysts both in the near and long term. I will start with the near term. As seen in the chart below, the consensus estimate suggests that DUK is poised for robust growth in the next few years. To wit, they estimate DUK's EPS to be $5.97 in 2024, representing a YoY growth of 7.40%. The forward P/E ratio thus implied at 15.69x only, a very reasonable valuation multiple in my view (more on this later). Looking out for 2 more years, its EPS is projected to be $6.74 in 2026 and the implied P/E would only be 13.90x then, which I consider a bargain deal for such a sector leader....
Duke Energy: Well-Positioned For Both Near And Long Term