- Price
- $121.47
- Fair value
- $131.00
- Discount
- 7.3%
- Uncertainty
- Low
- LSEG rating
- 2.32
- Moat
- Narrow
- Next earnings
- 2026-11-05
- Next earnings is estimate
- No
- Company name
- Duke Energy
- Sector
- Electric & gas utilities
- About
- Duke Energy is one of the largest US utility companies, based in Charlotte, North Carolina. Its electric utilities serve 8.7 million customers in North Carolina, South Carolina, Florida, Indiana, Ohio and Kentucky, and own 55,700 megawatts of generating capacity. Its gas utilities serve 1.6 million customers in North Carolina, South Carolina, Ohio and Kentucky. State commissions set its rates. In 2026, Duke sold Piedmont's Tennessee gas business to Spire for $2.5 billion, and it plans to merge Duke Energy Progress into Duke Energy Carolinas. Duke targets adjusted EPS growth of 5% to 7% a year through 2030.
- Thesis
- The market prices Duke Energy for a very large building plan that needs more debt and new shares. Total debt was $91.2 billion at June 30, 2026. In August 2026, Duke sold $2.0 billion of equity units, which oblige holders to buy new shares by August 2029. Regulators in its states also watch customer bills closely: Duke Energy Florida asked to lower rates in 2027, and Duke said in October 2026 that it protects customers from the costs of data centers. Storms add costs, such as Hurricane Isaias in Florida in October 2026. For the gap to close, three things must be true. The North Carolina Utilities Commission must approve the settlements in the Duke Energy Carolinas and Duke Energy Progress rate cases, with a return on equity of 9.8% on a 53% equity ratio, by November 2026, as Duke expects. Adjusted EPS must reach the 2026 guidance of $6.55 to $6.80 and keep growing 5% to 7% a year. Duke must fund its plan without more equity than planned. The Q3 2026 report on November 5, 2026 and the North Carolina orders by November 2026 are the next tests. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is higher interest rates, which raise financing costs and make regulated returns less attractive.
- Risks
- The North Carolina Utilities Commission can reject or change the rate case settlements. A lower return or less capital in the multi-year rate plans would reduce earnings growth from 2027.
The building plan needs large amounts of new debt and equity. The equity units sold in August 2026 will add new shares by 2029, and higher interest rates raise the cost of new debt.
Hurricanes and severe storms, such as Hurricane Isaias in October 2026 and a derecho in the Cincinnati area in August 2026, cause large repair costs. Duke must wait for regulators to approve the recovery of these costs.
Data center demand drives part of the growth plan. Regulators and lawmakers want data centers to pay their own costs, and new rules can change the terms of these contracts.
- Balance sheet
- Cash: $673M
Debt: $91.2B
Net debt: $90.6B
Debt due within 12 months: $9.0B
Duke funds its utilities with first mortgage bonds, senior notes, commercial paper and equity. At June 30, 2026, total debt was $91.2 billion: $82.2 billion of long-term debt, $6.67 billion of current maturities and $2.33 billion of notes payable and commercial paper. Cash was $673 million. In the first half of 2026, Duke received $2.5 billion from the sale of Piedmont's Tennessee business. In August 2026, it sold $2.0 billion of equity units, which include 4.85% notes due 2032 and 2036 and contracts to buy shares by August 2029. Debt keeps rising because the company invests more each year than its cash flow from operations.
As of 2026-06-30.
- Checkpoints
- Nov 5, 2026: Q3 2026 earnings: guidance. Pending. Watch: Adjusted EPS on track for the $6.55 to $6.80 guidance, with storm costs in line with the plan, passes; lower guidance or a large unrecovered storm cost fails.
Nov 2026 (estimate): North Carolina rate case orders. Pending. Watch: Orders that approve the settlements with a 9.8% return on equity and new rates from January 1, 2027 pass; a lower return, less approved capital or a delay fails.
- Recent events
- 2026-10-10: Hurricane Isaias passed through Florida. Duke Energy Florida restored power to about 10,000 customers by the next morning, with about 2,200 still without power, and said that its grid improvements helped customers.
2026-09-25: Duke's board appointed Joyce Mullen, the former CEO of Insight Enterprises, as a director from September 28, 2026.
2026-09-03: Duke Energy Florida asked regulators to lower its rates from January 2027, compared with December 2026.
2026-08-13: Duke sold 40 million equity units for $2.0 billion. Each unit includes a contract to buy Duke shares by August 1, 2029 and an interest in 4.85% notes due 2032 and 2036. The total annual payment on the units is 7.75%.
2026-08-05: Duke Energy Progress filed a settlement in its North Carolina rate case with a return on equity of 9.8% on a 53% equity ratio and about $3.4 billion of capital in its multi-year rate plan. Duke Energy Carolinas filed a similar settlement on July 17, 2026, with about $3.8 billion of capital. Orders are expected by November 2026.
2026-08-04: Duke reported Q2 2026 results. Reported EPS was $1.38 and adjusted EPS was $1.43, up from $1.25. Duke reaffirmed its 2026 adjusted EPS guidance of $6.55 to $6.80 and its 5% to 7% growth target through 2030.