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PPL Corporation (PPL)
:PPL
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PPL
(NYSE:PPL)
69Neutral
Positive Factors
Earnings Growth
The company's Q1 ongoing EPS grew by 9%, boosting confidence in meeting future guidance.
Market Performance
PPL's shares have outperformed the S&P Utilities, reflecting attractive EPS growth prospects and a strong balance sheet.
Strategic Initiatives
PPL continues to advance several strategic initiatives, enhancing its market position.
Negative Factors
Financial Risks
The elevated spending drives an earlier and higher need for equity issuance than previously anticipated.
Legislative Risks
The proposed energy legislation in Pennsylvania is seen as provocative, and there is caution regarding its passage.
Market Disconnect
Despite significant growth opportunities, shares of PPL have remained flat, suggesting a disconnect between potential and market performance.
PPL (PPL) vs. S&P 500 (SPY)
Market Cap
$26.67B
Dividend Yield2.86%
Average Volume (3M)6.36M
Price to Earnings (P/E)30.1
Beta (1Y)0.28
Revenue Growth1.80%
EPS Growth19.78%
CountryUS
Employees6,653
SectorUtilities
Sector Strength92
IndustryRegulated Electric
Share Statistics
EPS (TTM)1.20
Shares Outstanding739,263,900
10 Day Avg. Volume7,425,070
30 Day Avg. Volume6,361,924
Financial Highlights & Ratios
PEG Ratio1.52
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.52
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit7.99
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$38.18Price Target Upside5.82% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
PPL Business Overview & Revenue Model
Company DescriptionPPL Corporation, a utility holding company, delivers electricity and natural gas in the United States and the United Kingdom. The company operates through two segments: Kentucky Regulated and Pennsylvania Regulated. It serves approximately 429,000 electric and 333,000 natural gas customers in Louisville and adjacent areas in Kentucky; 538,000 electric customers in central, southeastern, and western Kentucky; and 28,000 electric customers in five counties in southwestern Virginia. The company also provides electric services to approximately 1.4 million customers in Pennsylvania; and generates electricity from coal, gas, hydro, and solar sources in Kentucky; and sells wholesale electricity to two municipalities in Kentucky. PPL Corporation was founded in 1920 and is headquartered in Allentown, Pennsylvania.
How the Company Makes MoneyPPL Corporation generates revenue primarily through its regulated utility operations, which provide electric service to residential, commercial, and industrial customers. The company's revenue model is based on the rates set by regulatory bodies, ensuring a stable income stream from its utility operations. These rates are determined by the cost of service plus a reasonable return on investment. Additionally, PPL benefits from regulatory frameworks that allow recovery of investments made in infrastructure improvements and environmental compliance. The company's earnings are also influenced by its operational efficiency, customer growth, and investments in modernizing its grid and expanding renewable energy sources.
PPL Financial Statement Overview
Summary
PPL demonstrates stability with improved profitability and operational efficiency. However, moderate revenue growth and a high debt load necessitate careful financial management. Enhanced cash conversion from profits and maintaining leverage within control will be key for continued financial health.Income Statement
The income statement shows a solid gross profit margin of 59.9% for 2024, up from previous years. Net profit margin improved to 10.5% from 8.9% in 2023, indicating better cost management. Revenue growth from 2023 to 2024 was modest at 1.8%, showing stability in sales despite industry challenges. EBIT and EBITDA margins remained stable, reflecting consistent operational efficiency.72
Positive
Balance Sheet
The balance sheet indicates a debt-to-equity ratio of 0.78 in 2024, suggesting manageable leverage levels. Return on equity improved slightly to 27.1%, highlighting efficient use of equity to generate profits. The equity ratio is not calculable due to missing total assets, but reduced equity compared to liabilities may signal potential risks if leverage increases.65
Positive
Cash Flow
Cash flow analysis reveals a challenging situation with a 100% increase in free cash flow compared to 2023, reaching $723 million. However, the operating cash flow to net income ratio decreased to 0.81, indicating less cash being converted from profits. Free cash flow to net income is positive, showing improvement but still requires cautious monitoring.58
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 8.46B | 8.31B | 7.90B | 5.78B | 7.61B | Gross Profit |
| 5.07B | 3.28B | 2.89B | 2.71B | 4.40B | EBIT |
| 1.74B | 1.63B | 1.37B | 1.42B | 2.80B | EBITDA |
| 3.21B | 2.93B | 2.66B | 2.58B | 2.67B | Net Income Common Stockholders |
| 888.00M | 740.00M | 756.00M | 18.00M | 1.47B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 306.00M | 331.00M | 356.00M | 3.57B | 708.00M | Total Assets |
| 41.07B | 39.24B | 37.84B | 33.22B | 48.12B | Total Debt |
| 2.54B | 15.60B | 14.23B | 11.21B | 24.79B | Net Debt |
| 2.54B | 15.27B | 13.87B | 7.64B | 24.08B | Total Liabilities |
| 26.99B | 25.30B | 23.92B | 19.50B | 34.74B | Stockholders Equity |
| 3.27B | 13.93B | 13.91B | 13.72B | 13.37B |
| Cash Flow | Free Cash Flow | |||
| 723.00M | -632.00M | -425.00M | 297.00M | -503.00M | Operating Cash Flow |
| 723.00M | 1.76B | 1.73B | 2.27B | 2.75B | Investing Cash Flow |
| -643.00M | -2.38B | -5.65B | 7.96B | -3.26B | Financing Cash Flow |
| -89.00M | 650.00M | 709.00M | -7.39B | 386.00M |
PPL Technical Analysis
Positive
36.08
Price Trends
34.99
Positive
33.84
Positive
32.63
Positive
Market Momentum
0.43
Negative
56.46
Neutral
80.98
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PPL, the sentiment is Positive. The current price of 36.08 is above the 20-day moving average (MA) of 35.40, above the 50-day MA of 34.99, and above the 200-day MA of 32.63, indicating a bullish trend. The MACD of 0.43 indicates Negative momentum. The RSI at 56.46 is Neutral, neither overbought nor oversold. The STOCH value of 80.98 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PPL.
PPL Risk Analysis
PPL disclosed 27 risk factors in its most recent earnings report. PPL reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
PPL Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $28.19B | 20.07 | 12.32% | 3.08% | -1.13% | 0.16% | |
70 Outperform | $26.50B | 22.19 | 10.08% | 2.74% | 1.64% | 1.04% | |
69 Neutral | $24.67B | 22.78 | 8.54% | 3.96% | 7.92% | 1.33% | |
69 Neutral | $21.83B | 26.20 | 5.56% | 4.87% | -0.08% | ― | |
69 Neutral | $26.67B | 30.13 | 6.33% | 2.86% | 1.80% | 19.78% | |
67 Neutral | $25.20B | 25.95 | 9.22% | 2.14% | 4.76% | 4.08% | |
63 Neutral | $8.48B | 11.92 | 6.36% | 4.35% | 3.15% | -10.41% |
* Utilities Sector Average
Performance Comparison
PPL
PPL
36.08
8.90
32.74%
AEE
Ameren
98.09
26.33
36.69%
CNP
Centerpoint Energy
38.60
9.96
34.78%
DTE
DTE Energy
135.84
26.90
24.69%
FE
FirstEnergy
42.75
5.12
13.61%
ES
Eversource Energy
59.08
1.82
3.18%
PPL Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: -0.85%|
Next Earnings Date:Aug 01, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong start to the fiscal year 2025 with significant growth in earnings and infrastructure investments. Regulatory approvals and data center interest point to positive future prospects. However, challenges remain with certain special item costs and segment performances, particularly in Rhode Island. Potential tariff impacts on planned projects are being monitored but are not expected to significantly derail the overall plan.Q1-2025 Updates
Positive Updates
Strong Start to Fiscal Year 2025
Reported first quarter GAAP earnings of $0.56 per share, and adjusted ongoing earnings of $0.60 per share, an 11% increase over the previous year's ongoing earnings of $0.54 per share.
Infrastructure and Capital Investment
On track to complete over $4 billion in infrastructure improvements in 2025, with a projected $20 billion in capital investment from 2025 to 2028, resulting in an average annual rate base growth of 9.8%.
Operational and Regulatory Approvals
Received regulatory approval for infrastructure investments worth nearly $400 million in Rhode Island, including $220 million for electric and $145 million for gas capital investments.
Data Center Development
Nearly 11 gigawatts of data center projects in advanced planning stages in Pennsylvania, with potential capital investment between $700 million to $850 million.
Financial Flexibility and Credit Metrics
Maintained a strong balance sheet with a $2 billion ATM program for financing. Issued about $170 million of equity year-to-date.
Negative Updates
Challenges with Special Items
Recorded special items costing $0.04 per share due to IT transformation costs, settlement charges related to Rhode Island energy efficiency programs, and integration costs.
Rhode Island Segment Performance
Decreased results by $0.01 per share due to lower transmission revenues from a prior period true-up and higher operating costs.
Potential Tariff Impact on Battery Storage
Concerns about tariff impacts on roughly 400 megawatts of planned battery storage, though mitigated by domestic sourcing strategies.
Company Guidance
During the PPL Corporation First Quarter 2025 Earnings Conference Call, the company provided guidance on several key metrics. PPL reported first quarter GAAP earnings of $0.56 per share, with earnings from ongoing operations adjusted to $0.60 per share, marking an 11% increase from $0.54 per share in the previous year. The company reaffirmed its 2025 earnings forecast of $1.75 to $1.87 per share, with a midpoint of $1.81. PPL plans to invest over $4 billion in infrastructure improvements in 2025, contributing to a projected rate base growth of 9.8% annually from 2025 to 2028. They also aim to achieve at least $150 million in cumulative O&M savings compared to the 2021 baseline. PPL targets a 6% to 8% annual earnings per share growth through at least 2028 and plans to maintain a 16% to 18% FFO-to-debt ratio and a holding company to total debt ratio below 25%.PPL Corporate Events
Business Operations and StrategyFinancial Disclosures
PPL Reports 35% Increase in Q1 2025 Earnings
Positive
Apr 30, 2025
PPL Corporation announced its first-quarter 2025 earnings, reporting a 35% increase in GAAP earnings to $414 million, or $0.56 per share, compared to the same period in 2024. The company reaffirmed its ongoing earnings forecast for 2025 and its annual EPS and dividend growth targets through 2028, highlighting strong financial discipline and operational execution, with a focus on creating utilities of the future.
Spark’s Take on PPL Stock
According to Spark, TipRanks’ AI Analyst, PPL is a Neutral.
PPL’s overall score reflects stable financial performance and strong technical momentum. The company’s focus on infrastructure investments and operational efficiencies positions it well for future growth. However, high valuation and significant financing needs pose risks. Maintaining leverage and enhancing cash flow conversion will be crucial for sustained financial health.
To see Spark’s full report on PPL stock, click here.
DividendsBusiness Operations and StrategyFinancial Disclosures
PPL Corporation Reports 2024 Earnings and Dividend Increase
Positive
Feb 13, 2025
PPL Corporation announced its 2024 earnings, reporting $1.20 per share in GAAP earnings and $1.69 per share from ongoing operations, reflecting a strategic focus on infrastructure investments and operational efficiencies. The company extended its growth targets through 2028, increasing its capital plan to $20 billion, and announced a 6% increase in its quarterly dividend, positioning itself for sustained growth in the utility sector.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.