Talen Energy Corp (TLN) AI Stock Analysis

• Market Cap: $16.27B
• Dividend Yield: N/A
• Average Volume (3M): 1.23M
• Price to Earnings (P/E): 101.7
• Beta (1Y): 1.37
• Revenue Growth: 125.17%
• EPS Growth: -74.67%
• Country: US
• Employees: 1,894
• Sector: Utilities
• Sector Strength: 75
• Industry: Independent Power Producers
• EPS (TTM): 1.50
• Shares Outstanding: 45,685,314
• 10 Day Avg. Volume: 777,054
• 30 Day Avg. Volume: 1,234,672
• 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: 1.04
• Enterprise Value/Revenue: 7.33
• Enterprise Value/Gross Profit: 17.09
• Enterprise Value/Ebitda: 24.64
• 1Y Price Target: $383.45
• Price Target Upside: 7.68% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11

• Rating: 65 Neutral
• Price Target: $405.00 ▲(13.73% Upside)

Talen Energy Corp's overall stock score reflects strong technical momentum and positive corporate events, which are offset by valuation concerns and financial challenges. The company's strategic expansions and acquisitions position it well for future growth, but high P/E ratios and cash flow difficulties present risks.

Positive Factors

Acquisition

The acquisition of Moxie Freedom and Guernsey gas plants is expected to be immediately accretive to free cash flow per share by 40% to 50% over a few years.

Contract Expansion

Talen announced an upsizing of the contract between Amazon Web Services and the company's Susquehanna nuclear plant, indicating strong demand and business growth.

Financial Performance

Talen Energy is reiterating its Outperform rating and has increased its price target to $372, reflecting strong expected growth.

Negative Factors

Competition

The outlook for merchant nuclear has been impaired with increasing competition and uncertainty in securing high-value contracts.

Market Perception

Investors have soured on the nuclear-data center thematic, indicating challenges in the broader market perception.

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's financial statements present a mixed picture. The company demonstrates strong profitability margins, particularly at the net income level, yet faces challenges with revenue growth and cash flow generation. The high leverage and low equity ratio reflect potential financial risks, while the strong return on equity suggests effective utilization of equity capital. The company needs to focus on improving cash flow conversion and reducing leverage to enhance financial stability.

Income Statement

The company's income statement reveals mixed results. The gross profit margin for TTM is approximately 33.7%, indicating strong efficiency in converting revenue into profit. However, the net profit margin is much higher at 31.2%, reflecting substantial net income. Revenue has decreased from the previous year, creating a negative growth trend, although the EBIT margin of 5.6% suggests some operational profitability. EBITDA margin remains robust at 64.3%, indicative of strong earnings before non-cash expenses.

Balance Sheet

The balance sheet shows a moderate level of financial stability. The debt-to-equity ratio is 2.54, indicating a high level of leverage which could pose financial risks if not managed properly. The return on equity is strong at 48.2% for TTM, suggesting effective use of equity capital to generate profits. However, the equity ratio is relatively low at 20.1%, which points to a reliance on debt financing.

Cash Flow

Cash flow analysis indicates challenges with growth and earnings conversion. The free cash flow growth rate is negative, showing a significant decline compared to the previous year. The operating cash flow to net income ratio is low at 0.35, suggesting that net income does not closely translate into cash flow. The free cash flow to net income ratio is also low at 0.03, indicating limited free cash generation relative to net income.

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: Neutral
• Last Price: 356.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TLN, the sentiment is Neutral. The current price of 356.11 is below the 20-day moving average (MA) of 373.06, above the 50-day MA of 323.81, and above the 200-day MA of 243.60, indicating a neutral trend. The MACD of 11.75 indicates Positive momentum. The RSI at 51.59 is Neutral, neither overbought nor oversold. The STOCH value of 20.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TLN.

Talen Energy Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VST	78 Outperform	$64.47B	30.19	45.85%	0.47%	46.90%	388.66%
HTO	69 Neutral	$1.80B	16.70	7.50%	1.65%	12.40%	11.98%
Sector *	67 Neutral	$17.80B	18.42	5.29%	3.53%	7.33%	12.21%
CEPU	65 Neutral	$1.68B	9.94	9.38%	3.19%	-9.20%	-53.99%
TLN	65 Neutral	$16.27B	101.68	9.95%	―	125.17%	-74.67%
HE	58 Neutral	$2.11B	―	-1.53%	―	-11.75%	96.86%
NRG	58 Neutral	$28.06B	61.40	17.66%	1.19%	2.09%	-74.13%

Talen Energy Corp Corporate Events

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.

Talen Energy Extends Maintenance at Susquehanna Station

On May 19, 2025, Talen Energy Corp announced an update regarding the maintenance outage at its Susquehanna Steam Electric Station. The planned refueling outage on Unit 2, which began in late March, was extended due to additional maintenance needs, increasing costs by $35 million. The completion of maintenance is expected by the first week of June, with efficiency gains anticipated to offset costs within two years. Despite the delay, the company’s financial guidance for 2025 remains unchanged.