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Talen Energy Corp (TLN)
NASDAQ:TLN
US Market

Talen Energy Corp (TLN) AI Stock Analysis

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Talen Energy Corp

(NASDAQ:TLN)

Rating:63Neutral
Price Target:
$293.00
▲(6.06%Upside)
Talen Energy's overall stock score is positively influenced by strong technical indicators and proactive strategic initiatives, including significant share buybacks and partnerships. However, financial leverage and cash flow concerns, combined with potential market risks, moderate the overall outlook.
Positive Factors
Business Growth
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 Stability
Significantly higher free cash flow given limited costs associated with the deal, enhancing financial stability and potential returns for investors.
Revenue Stability
The company has contracted nearly the entire output of its nuclear plant at premium prices through at least 2042, ensuring stable and attractive revenue.
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.
Regulatory Challenges
FERC reaffirmed its original rejection of Talen's proposal to expand the Amazon data center at its Susquehanna nuclear plant.

Talen Energy Corp (TLN) vs. SPDR S&P 500 ETF (SPY)

Talen Energy Corp Business Overview & Revenue Model

Company DescriptionTalen Energy Corp (TLN) is a privately held independent power producer headquartered in the United States. The company operates a diverse portfolio of power generation assets, including nuclear, coal, natural gas, and renewable energy facilities. Talen Energy is committed to delivering reliable energy solutions while transitioning towards cleaner and more sustainable energy sources.
How the Company Makes MoneyTalen Energy Corp generates revenue primarily through the sale of electricity generated from its various power plants. The company sells electricity to wholesale markets, utilities, and large industrial customers. Talen Energy's revenue streams are influenced by factors such as electricity market prices, fuel costs, and regulatory environments. The company also engages in energy trading and management services, which contribute additional revenue. As part of its strategic initiatives, Talen Energy is investing in renewable energy and energy storage projects to enhance its revenue potential and align with industry trends towards sustainability.

Talen Energy Corp Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 19.44%|
Next Earnings Date:Aug 13, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with significant share buybacks and operational achievements such as AWS campus electrification. However, challenges like the extended outage at Susquehanna and market skepticism about data center demand and tariff impacts present concerns.
Q1-2025 Updates
Positive Updates
Strong Financial Performance
Talen Energy Corporation reported $200 million of EBITDA and $87 million of free cash flow, surpassing internal estimates and underpinning their 2025 guidance.
Share Repurchase Program
The company executed $83 million in share buybacks during Q1 2025, and since 2024, has repurchased 14 million shares, representing 23% of outstanding shares.
AWS Campus Electrification
The AWS campus has been electrified, and Talen Energy is delivering power and receiving revenues under the existing contract, with plans to ramp up to 120 megawatts over the year.
Increased Generation and Safety
Fossil fleet generation increased by approximately 20% compared to the previous year, and the company maintained a low recordable incident rate of 0.4.
Adjusted Guidance
Talen Energy narrowed and reaffirmed its 2025 guidance ranges for adjusted EBITDA ($975 million to $1.125 billion) and adjusted free cash flow ($450 million to $540 million).
Negative Updates
Extended Outage at Susquehanna Unit 2
The refueling outage for Susquehanna Unit 2 was extended by over three weeks due to additional maintenance needs, incurring an incremental cost of approximately $20 million.
Market Skepticism
Concerns were raised about data center rebalancing and the lack of strength in power forwards, leading to skepticism about the underlying thesis in the IPP space.
Impact of Tariffs and Trade Restrictions
Market uncertainty due to trade restrictions and tariffs poses long-term cost considerations, although they are not currently having a material effect.
Company Guidance
During Talen Energy Corporation's First Quarter 2025 Earnings Call, the company provided guidance for the year. The results for Q1 showed strong performance, with $200 million in EBITDA and $87 million in free cash flow, which exceeded their internal estimates. This led to a narrowing and reaffirmation of their 2025 guidance, with adjusted EBITDA now expected to be between $975 million and $1.125 billion and adjusted free cash flow projected to be between $450 million and $540 million. The company continued its share repurchase program, buying back $83 million worth of shares during the quarter. Additionally, Talen Energy emphasized its strategic focus on operational excellence, commercialization of megawatts, and expanding contracts, particularly with AWS at the Susquehanna site. The ongoing maintenance at Susquehanna Unit 2 is expected to restore over 27 megawatts, with an estimated payback period of one and a half years based on current market prices. The 2026 outlook remains unchanged, reflecting Talen's confidence in the tightening power market and increased demand, particularly from data centers.

Talen Energy Corp Financial Statement Overview

Summary
Talen Energy Corp's financial statements present a mixed picture. Strong profitability margins, particularly at the net income level, contrast with challenges in revenue growth and cash flow generation. High leverage and a low equity ratio present potential financial risks, underscoring the need for improved cash flow conversion and leverage reduction.
Income Statement
55
Neutral
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
45
Neutral
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
50
Neutral
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue1.82B2.07B1.44B3.02B1.77B
Gross Profit614.00M664.00M453.00M1.34B244.00M
EBITDA1.17B1.77B1.71B1.20B-301.00M
Net Income569.00M998.00M613.00M-1.29B-977.00M
Balance Sheet
Total Assets5.87B6.11B7.12B10.72B10.05B
Cash, Cash Equivalents and Short-Term Investments295.00M329.00M401.00M988.00M276.00M
Total Debt3.00B3.00B2.83B5.91B4.81B
Total Liabilities4.68B4.72B4.59B11.20B9.32B
Stockholders Equity1.18B1.39B2.46B-573.00M733.00M
Cash Flow
Free Cash Flow15.00M67.00M516.00M-125.00M-518.00M
Operating Cash Flow202.00M256.00M864.00M187.00M-294.00M
Investing Cash Flow838.00M1.17B-347.00M-368.00M-280.00M
Financing Cash Flow-1.80B-1.96B-604.00M426.00M956.00M

Talen Energy Corp Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price276.27
Price Trends
50DMA
250.43
Positive
100DMA
228.73
Positive
200DMA
214.45
Positive
Market Momentum
MACD
10.99
Positive
RSI
53.76
Neutral
STOCH
22.47
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 276.27 is below the 20-day moving average (MA) of 278.47, above the 50-day MA of 250.43, and above the 200-day MA of 214.45, indicating a neutral trend. The MACD of 10.99 indicates Positive momentum. The RSI at 53.76 is Neutral, neither overbought nor oversold. The STOCH value of 22.47 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TLN.

Talen Energy Corp Risk Analysis

Talen Energy Corp disclosed 38 risk factors in its most recent earnings report. Talen Energy Corp reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Talen Energy Corp Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
VSVST
73
Outperform
$63.46B29.3346.29%0.48%49.22%313.49%
71
Outperform
$1.79B17.965.84%2.99%-9.99%-73.66%
NRNRG
71
Outperform
$30.49B24.5644.91%1.13%2.57%-10.19%
HTHTO
70
Outperform
$1.82B17.827.49%3.16%12.34%11.78%
67
Neutral
$16.39B16.974.47%3.56%4.77%6.10%
TLTLN
63
Neutral
$12.74B28.7929.32%68.95%-34.72%
HEHE
50
Neutral
$1.86B-67.93%-7.58%-819.97%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TLN
Talen Energy Corp
276.27
157.28
132.18%
HE
Hawaiian Electric
10.80
2.72
33.66%
NRG
NRG Energy
155.54
79.47
104.47%
HTO
H2O America
53.14
0.44
0.83%
VST
Vistra Energy
187.02
98.28
110.75%
CEPU
Central Puerto SA
11.82
3.15
36.33%

Talen Energy Corp Corporate Events

Business Operations and Strategy
Talen Energy Expands Nuclear Partnership with AWS
Positive
Jun 11, 2025

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.

The most recent analyst rating on (TLN) stock is a Buy with a $233.00 price target. To see the full list of analyst forecasts on Talen Energy Corp stock, see the TLN Stock Forecast page.

Business Operations and Strategy
Talen Energy Extends Maintenance at Susquehanna Station
Neutral
May 19, 2025

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.

The most recent analyst rating on (TLN) stock is a Buy with a $233.00 price target. To see the full list of analyst forecasts on Talen Energy Corp stock, see the TLN Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Talen Energy Corp Approves 2025 Employee Stock Plan
Neutral
May 12, 2025

On May 7, 2025, Talen Energy Corporation held its Annual Meeting of Stockholders, where several proposals were approved, including the 2025 Employee Stock Purchase Plan (ESPP), which allows employees to buy company stock at a 15% discount. Additionally, the election of directors, executive compensation, and the appointment of PricewaterhouseCoopers LLP as the independent auditor for 2025 were ratified, impacting the company’s governance and financial oversight.

The most recent analyst rating on (TLN) stock is a Buy with a $233.00 price target. To see the full list of analyst forecasts on Talen Energy Corp stock, see the TLN Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jun 12, 2025