Talen Energy Corp (TLN) AI Stock Analysis

• Market Cap: $18.32B
• Dividend Yield: N/A
• Average Volume (3M): 1.16M
• Price to Earnings (P/E): 114.5
• Beta (1Y): 1.37
• Revenue Growth: 125.17%
• EPS Growth: -74.67%
• Country: US
• Employees: 1,894
• Sector: Utilities
• Sector Strength: 62
• Industry: Independent Power Producers
• EPS (TTM): 1.50
• Shares Outstanding: 45,685,314
• 10 Day Avg. Volume: 1,504,577
• 30 Day Avg. Volume: 1,162,277
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.92
• Enterprise Value/Revenue: 7.33
• Enterprise Value/Gross Profit: 17.09
• Enterprise Value/Ebitda: 24.64
• 1Y Price Target: $433.18
• Price Target Upside: 7.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11

• Rating: 64 Neutral
• Price Target: $410.00 ▲(1.86% Upside)

Talen Energy's overall score is driven by strong technical indicators and strategic expansions, including partnerships and acquisitions. However, high valuation concerns and cash flow challenges weigh down the score. The earnings call provided a balanced view of strategic growth and operational challenges.

Positive Factors

Revenue Growth

Strong revenue growth indicates expanding market reach and effective sales strategies, supporting long-term business sustainability.

Strategic Acquisitions

These acquisitions enhance Talen's energy portfolio, increasing generation capacity and cash flow, strengthening competitive position.

Amazon Contract Expansion

The expanded contract with Amazon secures long-term revenue and aligns with clean energy goals, reducing market risk.

Negative Factors

Cash Flow Challenges

Severe cash flow challenges could limit operational flexibility and investment capacity, impacting long-term growth potential.

Operational Inefficiencies

Declining profit margins suggest inefficiencies that could undermine profitability and require strategic adjustments.

Extended Outage Impact

The outage impacts financial results and highlights operational risks, potentially affecting reliability and stakeholder confidence.

Talen Energy Corp Business Overview & Revenue Model

Company Description

Talen Energy Corp (TLN) is a privately held independent power producer headquartered in the United States. The company is engaged in the generation and sale of electricity, operating a diverse portfolio of power plants across various regions. Talen Energy's assets include a mix of nuclear, coal, natural gas, and renewable energy facilities, making it one of the largest independent power producers in the country. The company's focus is on delivering reliable and affordable energy while transitioning towards cleaner energy solutions.

How the Company Makes Money

Talen Energy Corp generates revenue primarily through the production and sale of electricity. The company's diverse portfolio allows it to sell power to wholesale markets and directly to large industrial and commercial customers. Revenue is derived from long-term power purchase agreements, capacity payments, and energy market sales. Additionally, Talen Energy benefits from ancillary services and renewable energy credits, which provide additional income streams. The company's strategic partnerships and investments in renewable energy projects also contribute to its earnings by expanding its clean energy footprint and leveraging government incentives for renewable power generation.

Talen Energy Corp Financial Statement Overview

Summary

Talen Energy Corp shows strong revenue growth and improved gross profit margins, indicating positive sales momentum and cost management. However, declining net profit margins and operational inefficiencies pose profitability challenges. The balance sheet shows improved leverage, enhancing financial stability, but cash flow difficulties remain a significant concern.

Income Statement

Talen Energy Corp shows a strong revenue growth rate of 24.54% in the TTM, indicating a positive trajectory in sales. The gross profit margin improved to 42.89%, reflecting efficient cost management. However, the net profit margin decreased significantly from 48.14% in 2024 to 8.13% in the TTM, suggesting challenges in maintaining profitability. The EBIT and EBITDA margins also declined, indicating potential operational inefficiencies.

Balance Sheet

The company's debt-to-equity ratio improved dramatically to 0.01 in the TTM, showcasing a significant reduction in leverage, which enhances financial stability. The return on equity is at 12.06%, indicating decent profitability relative to shareholder equity. However, the equity ratio is not calculated due to missing data, which limits a comprehensive assessment of asset financing.

Cash Flow

The cash flow statement reveals a concerning free cash flow growth rate of -493.33% in the TTM, indicating cash flow challenges. The operating cash flow to net income ratio is low at 0.09, suggesting limited cash generation from operations relative to net income. The negative free cash flow to net income ratio further highlights cash flow difficulties.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.30B	2.07B	1.44B	3.02B	1.77B
Gross Profit	986.00M	664.00M	453.00M	1.34B	244.00M
EBITDA	684.00M	1.77B	1.71B	1.39B	-301.00M
Net Income	187.00M	998.00M	613.00M	-1.29B	-977.00M
Balance Sheet
Total Assets	5.83B	6.11B	7.12B	10.72B	10.05B
Cash, Cash Equivalents and Short-Term Investments	135.00M	329.00M	401.00M	988.00M	276.00M
Total Debt	17.00M	3.00B	2.83B	4.35B	4.81B
Total Liabilities	4.58B	4.72B	4.59B	11.20B	9.32B
Stockholders Equity	1.25B	1.39B	2.46B	-573.00M	733.00M
Cash Flow
Free Cash Flow	-59.00M	67.00M	516.00M	-125.00M	-518.00M
Operating Cash Flow	41.00M	256.00M	864.00M	187.00M	-294.00M
Investing Cash Flow	78.00M	1.17B	-347.00M	-368.00M	-280.00M
Financing Cash Flow	-1.10B	-1.96B	-604.00M	426.00M	956.00M

Talen Energy Corp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 402.53
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TLN, the sentiment is Positive. The current price of 402.53 is above the 20-day moving average (MA) of 379.07, above the 50-day MA of 351.33, and above the 200-day MA of 256.32, indicating a bullish trend. The MACD of 12.16 indicates Negative momentum. The RSI at 67.61 is Neutral, neither overbought nor oversold. The STOCH value of 83.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TLN.

Talen Energy Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VST	77 Outperform	$69.14B	32.37	45.85%	0.42%	46.90%	388.66%
CEPU	70 Neutral	$1.37B	8.10	9.38%	3.94%	-9.20%	-53.99%
HTO	68 Neutral	$1.76B	16.31	7.50%	1.69%	12.40%	11.98%
Sector *	66 Neutral	$17.51B	18.09	5.60%	3.63%	6.62%	11.55%
TLN	64 Neutral	$18.32B	114.47	9.95%	―	125.17%	-74.67%
HE	58 Neutral	$2.10B	―	-1.53%	―	-11.75%	96.86%
NRG	58 Neutral	$30.55B	66.83	17.66%	1.05%	2.09%	-74.13%

Talen Energy Corp Corporate Events

Talen Energy Expands Share Repurchase Program by $1.005B

On September 8, 2025, Talen Energy’s board approved an increase in its share repurchase program by $1.005 billion, extending the expiration date to December 31, 2028. This decision raises the total authorization to $2 billion, contingent upon the completion of the Freedom and Guernsey acquisitions expected by the end of 2025. Talen plans to fund the repurchases with cash on hand and operational cash flow, with the flexibility to adjust the program based on market conditions and other factors.

Talen Energy Reports Strong PJM Auction Results

On July 22, 2025, Talen Energy announced its results from the PJM Base Residual Auction for the 2026/2027 planning year, where it cleared 6,702 megawatts at a price of $329.17 per megawatt-day, resulting in approximately $805 million in capacity revenues. This outcome underscores Talen’s robust position in the power market, highlighting its ability to secure substantial revenues and maintain its competitive edge in the energy sector.

Talen Energy Acquires Moxie Freedom and Guernsey Stations

On July 17, 2025, Talen Energy announced the acquisition of Caithness Energy’s Moxie Freedom Energy Center in Pennsylvania and Guernsey Power Station in Ohio for a net price of $3.5 billion. These acquisitions, involving highly efficient combined-cycle gas-fired plants, are expected to significantly enhance Talen’s energy portfolio by increasing annual generation by 50% and providing substantial cash flow benefits. The transaction is projected to be immediately accretive to free cash flow per share by over 40% in 2026, with further benefits through 2029, while maintaining Talen’s balance sheet strength and supporting future capital allocation strategies.

Talen Energy Expands Nuclear Partnership with AWS

On June 11, 2025, Talen Energy announced an expansion of its nuclear energy partnership with Amazon Web Services, involving a power purchase agreement to supply 1,920 megawatts of carbon-free electricity from Talen’s Susquehanna nuclear power plant to AWS data centers in Pennsylvania. This agreement, which extends through 2042, aims to support Amazon’s AI and cloud technologies and includes plans to explore Small Modular Reactors and expand the plant’s energy output. The partnership is expected to decrease Talen’s market risk and support Pennsylvania’s energy future, with significant economic and employment benefits for the region.