Stock of the Day

June 4, 2020

Public Service Enterprise Group (PEG)

$83.82
-$0.85 (-1.0%)
Market Cap: $42.18B

About Public Service Enterprise Group

Public Service Enterprise Group Incorporated, through its subsidiaries, operates in electric and gas utility business in the United States. It operates through PSE&G and PSEG Power segments. The PSE&G segment transmits electricity; distributes electricity and natural gas to residential, commercial, and industrial customers; and appliance services and repairs to customers through its service territory, as well as invests in solar generation projects, and energy efficiency and related programs. The PSEG Power segment engages in nuclear generation businesses; and supplies power and natural gas to nuclear power plants and gas storage facilities activities. As of December 31, 2023, it had electric transmission and distribution system of 25,000 circuit miles and 866,600 poles; 56 switching stations with an installed capacity of 39,953 megavolt-amperes (MVA), and 235 substations with an installed capacity of 10,382 MVA; 109 MVA aggregate installed capacity for substations; four electric distribution headquarters and five electric sub-headquarters; 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 56 natural gas metering and regulating stations; and 158 MegaWatts defined conditions of installed PV solar capacity. Public Service Enterprise Group Incorporated was founded in 1903 and is based in Newark, New Jersey.

Public Service Enterprise Group Bull Case

Here are some ways that investors could benefit from investing in Public Service Enterprise Group Incorporated:

  • The company recently increased its quarterly dividend to $0.63 per share, reflecting a commitment to returning value to shareholders. This translates to an annualized dividend of $2.52, providing a dividend yield of 3.01%, which is attractive for income-focused investors.
  • Public Service Enterprise Group Incorporated has a strong market capitalization of approximately $41.78 billion, indicating a stable and established presence in the utility sector, which can provide a sense of security for investors.
  • Recent analyst ratings show a consensus average rating of "Moderate Buy" with a target price of $88.83, suggesting potential upside from the current stock price of $83.85, which could attract investors looking for growth opportunities.
  • The company has demonstrated resilience with a relatively low beta of 0.64, indicating that its stock price is less volatile compared to the overall market, making it a potentially safer investment during market fluctuations.
  • Public Service Enterprise Group Incorporated operates in the electric and gas utility sector, which tends to be less affected by economic downturns, providing a stable revenue stream and making it a defensive investment choice.

Public Service Enterprise Group Bear Case

Investors should be bearish about investing in Public Service Enterprise Group Incorporated for these reasons:

  • The company's debt-to-equity ratio stands at 1.18, which indicates a higher level of debt compared to equity. This could pose risks, especially if interest rates rise or if the company faces financial challenges.
  • Despite the recent dividend increase, the dividend payout ratio is currently at 58.97%, which means that a significant portion of earnings is being distributed as dividends. This could limit the company's ability to reinvest in growth opportunities.
  • Public Service Enterprise Group Incorporated's stock has experienced fluctuations, with a 52-week high of $95.22 and a low of $58.96, indicating potential volatility that could deter risk-averse investors.
  • Insider selling activity has been noted, with a total of 3,712 shares sold worth $317,644 over the last 90 days. This could raise concerns about the confidence of insiders in the company's future performance.
  • The current quick ratio of 0.48 suggests that the company may have difficulty meeting its short-term liabilities, which could be a red flag for investors concerned about liquidity.

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