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Xcel Energy Inc (XEL)
NASDAQ:XEL
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Xcel Energy (XEL) AI Stock Analysis

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XEL

Xcel Energy

(NASDAQ:XEL)

Rating:68Neutral
Price Target:
$80.00
▲(10.07% Upside)
Xcel Energy's overall stock score reflects a stable financial performance with strong profitability but high leverage and negative free cash flow. Positive technical indicators and strategic investments in infrastructure and renewable energy support a favorable outlook. However, valuation concerns and potential regulatory challenges from corporate events and earnings call risks temper the overall score.
Positive Factors
De-risking Event
The Marshall Fire litigation resolution is seen as a major de-risking event for Xcel Energy shares.
Growth Potential
Xcel Energy is expected to have the highest ratebase CAGR among large-cap utilities, enhancing its growth potential.
Risk Reduction
Reduced fire risk is anticipated to meaningfully decrease equity dilution as the Marshall Fire issue is resolved.
Negative Factors
Customer Impact Risk
Projects planned post-2029 could have an adverse impact on customers if not addressed, highlighting a potential risk.
Financial Challenges
The reduction in cash flow in the interim could require incremental equity issuance or other mitigation measures to preserve credit metrics.
Regulatory Concerns
Caution around recent regulatory developments is reflected in the rating.

Xcel Energy (XEL) vs. SPDR S&P 500 ETF (SPY)

Xcel Energy Business Overview & Revenue Model

Company DescriptionXcel Energy Inc., through its subsidiaries, generates, purchases, transmits, distributes, and sells electricity. It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments. The company generates electricity through coal, nuclear, natural gas, hydroelectric, solar, biomass, oil, wood/refuse, and wind energy sources. It also purchases, transports, distributes, and sells natural gas to retail customers, as well as transports customer-owned natural gas. In addition, the company develops and leases natural gas pipelines, and storage and compression facilities; and invests in rental housing projects, as well as procures equipment for the construction of renewable generation facilities. It serves residential, commercial, and industrial customers in the portions of Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas, and Wisconsin. The company sells electricity to approximately 3.7 million customers; and natural gas to approximately 2.1 million customers. Xcel Energy Inc. was incorporated in 1909 and is headquartered in Minneapolis, Minnesota.
How the Company Makes MoneyXcel Energy generates revenue primarily through the sale of electricity and natural gas to residential, commercial, and industrial customers. Its revenue model is based on regulated utility rates set by state public utility commissions, which allow the company to recover its costs and earn a reasonable return on investment. Key revenue streams include electricity sales from both renewable sources (such as wind and solar) and traditional fossil fuel sources (like natural gas and coal). Additionally, Xcel Energy earns income from natural gas sales and various energy efficiency programs. Significant partnerships with state governments, renewable energy developers, and other stakeholders contribute to its growth, particularly in expanding its renewable energy portfolio and achieving sustainability goals.

Xcel Energy Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook with strong earnings performance, significant infrastructure investments, and progress in wildfire mitigation and data center growth. However, challenges such as higher interest charges, increased depreciation, and the pending Marshall Fire trial pose potential concerns.
Q2-2025 Updates
Positive Updates
Strong Earnings Performance
Xcel Energy delivered earnings of $0.75 per share for Q2 2025 compared to $0.54 per share in Q2 2024. This was driven by higher revenue from electric and natural gas service and increased AFUDC.
Increased Infrastructure Investment
Xcel Energy invested $2.6 billion in resilient and reliable energy infrastructure. The company anticipates needing an additional $15 billion in capital investment to meet customer needs over the next five years.
Wildfire Mitigation Progress
The Colorado PUC approved a $1.9 billion Wildfire Mitigation Plan, and the Texas Commission approved a $500 million system resiliency plan.
Data Center Growth
Xcel Energy is progressing with its data center pipeline, having 1.1 gigawatts under construction and under contract, with plans to reach 2.5 gigawatts by 2030.
Negative Updates
Higher Interest Charges
Higher interest charges decreased earnings by $0.04 per share due to increased debt levels and interest rates.
Increased Depreciation and Amortization
Higher depreciation and amortization decreased earnings by $0.03, driven by increased system investment.
Marshall Fire Trial
Xcel Energy is preparing for a trial related to the Marshall Fire, which could have significant financial implications depending on the outcome.
Company Guidance
During the second quarter of 2025, Xcel Energy delivered strong financial performance with earnings of $0.75 per share, up from $0.54 per share in the second quarter of 2024. The company made substantial investments totaling $2.6 billion in energy infrastructure to enhance reliability and safety, including efforts to mitigate wildfire risks. Xcel Energy expects to meet its earnings guidance for the 21st consecutive year, maintaining long-term growth in the upper half of its 6-8% target range. The company anticipates an additional $15 billion in capital investment beyond its initial $45 billion five-year plan, driven by increased energy demand and infrastructure needs, especially in regions like Texas, New Mexico, and Minnesota. These investments include substantial generation and transmission projects, with a focus on clean energy resources such as wind, solar, and natural gas. Despite regulatory considerations and evolving energy policies, Xcel remains confident in its ability to deliver value to customers and investors, reaffirming its 2025 earnings guidance of $3.75 to $3.85 per share.

Xcel Energy Financial Statement Overview

Summary
Xcel Energy demonstrates stable revenue growth and strong profitability margins, but faces challenges with high leverage and negative free cash flow. While the company efficiently generates cash from operations, the reliance on debt and negative free cash flow growth could impact financial flexibility. Overall, the financial health is solid but requires careful management of debt and cash flow.
Income Statement
75
Positive
Xcel Energy's income statement shows a stable performance with a slight revenue growth of 1.79% in the TTM period. The company maintains healthy margins with a gross profit margin of 34.29% and a net profit margin of 14.85%. EBIT and EBITDA margins are also strong at 20.99% and 42.00%, respectively. However, the gross profit margin has decreased from previous years, indicating potential cost pressures.
Balance Sheet
65
Positive
The balance sheet reveals a high debt-to-equity ratio of 3.06, indicating significant leverage, which could pose financial risks. Return on equity is moderate at 10.41%, suggesting efficient use of equity. The equity ratio stands at 27.82%, reflecting a balanced asset structure but highlighting the reliance on debt financing.
Cash Flow
55
Neutral
Cash flow analysis shows a challenging scenario with negative free cash flow and a free cash flow to net income ratio of -22.66%. Although operating cash flow is strong, the negative free cash flow growth rate suggests potential liquidity issues. The operating cash flow to net income ratio is robust at 5.5, indicating good cash generation relative to net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue13.96B13.44B14.21B15.31B13.43B11.53B
Gross Profit6.39B6.15B5.98B5.86B5.26B4.96B
EBITDA5.87B5.59B5.20B5.08B4.60B4.32B
Net Income2.07B1.94B1.77B1.74B1.60B1.47B
Balance Sheet
Total Assets75.34B70.03B64.08B61.19B57.85B53.96B
Cash, Cash Equivalents and Short-Term Investments1.45B179.00M129.00M111.00M166.00M129.00M
Total Debt33.33B30.21B27.51B26.03B24.74B22.21B
Total Liabilities54.38B50.51B46.46B44.51B42.24B39.38B
Stockholders Equity20.96B19.52B17.62B16.68B15.61B14.57B
Cash Flow
Free Cash Flow-1.02B-2.72B-527.00M-706.00M-2.06B-2.52B
Operating Cash Flow4.51B4.64B5.33B3.93B2.19B2.85B
Investing Cash Flow-8.46B-7.43B-5.93B-4.65B-4.29B-4.74B
Financing Cash Flow3.80B2.84B617.00M666.00M2.13B1.77B

Xcel Energy Technical Analysis

Technical Analysis Sentiment
Positive
Last Price72.68
Price Trends
50DMA
71.39
Positive
100DMA
70.19
Positive
200DMA
68.78
Positive
Market Momentum
MACD
0.19
Positive
RSI
52.55
Neutral
STOCH
33.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XEL, the sentiment is Positive. The current price of 72.68 is below the 20-day moving average (MA) of 72.72, above the 50-day MA of 71.39, and above the 200-day MA of 68.78, indicating a neutral trend. The MACD of 0.19 indicates Positive momentum. The RSI at 52.55 is Neutral, neither overbought nor oversold. The STOCH value of 33.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for XEL.

Xcel Energy Risk Analysis

Xcel Energy disclosed 33 risk factors in its most recent earnings report. Xcel Energy 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

Xcel Energy Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
75
Outperform
$49.66B20.109.29%4.59%7.60%55.99%
74
Outperform
$57.82B15.8413.03%3.44%5.84%36.33%
73
Outperform
$93.79B19.729.60%3.48%4.07%9.94%
73
Outperform
$43.86B16.499.87%3.64%4.46%8.68%
68
Neutral
$42.98B20.1610.65%3.08%1.20%7.99%
66
Neutral
$17.24B18.035.60%3.64%6.63%11.55%
65
Neutral
$100.96B23.7012.89%3.18%8.53%-7.53%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
XEL
Xcel Energy
72.68
11.28
18.37%
AEP
American Electric Power
108.11
8.13
8.13%
D
Dominion Energy
58.19
3.43
6.26%
DUK
Duke Energy
120.61
7.63
6.75%
EXC
Exelon
43.43
6.11
16.37%
SO
Southern Co
91.78
5.36
6.20%

Xcel Energy Corporate Events

Business Operations and StrategyRegulatory Filings and Compliance
Xcel Energy’s Rate Increase Approved for 2025
Neutral
Aug 25, 2025

In November 2024, Northern States Power Company, a subsidiary of Xcel Energy, filed for an electric rate increase in Minnesota, requesting a $491 million revenue boost over two years. The Minnesota Public Utilities Commission approved interim rates of $192 million for 2025. Various stakeholders, including the Minnesota Department of Commerce and Walmart, proposed adjustments to the rate request, focusing on reducing the return on equity and other expenses. A decision by the MPUC is anticipated in the third quarter of 2026.

Business Operations and StrategyRegulatory Filings and Compliance
Xcel Energy’s Rate Increase Proposal Adjustments Recommended
Neutral
Aug 11, 2025

In March 2025, Northern States Power Company-Wisconsin, a subsidiary of Xcel Energy, filed a request with the Public Service Commission of Wisconsin for a multi-year increase in electric and natural gas rates. The request includes a $151 million electric revenue increase over 2026 and 2027, and a $24 million natural gas revenue increase over the same period. On August 8, 2025, the PSCW Staff recommended adjustments, suggesting a $115 million increase for electric and $21 million for natural gas, with a decision expected by late 2025. This rate adjustment proposal reflects NSP-Wisconsin’s strategic focus on infrastructure investments and operational cost management, impacting stakeholders by potentially altering service costs and investment returns.

Business Operations and StrategyRegulatory Filings and Compliance
Xcel Energy’s SPS Selects 3,121 MW Capacity Portfolio
Positive
Jul 18, 2025

In October 2023, SPS, a subsidiary of Xcel Energy, filed its Integrated Resource Plan (IRP) with the New Mexico Public Regulation Commission (NMPRC) to address projected load growth and reliability needs, securing replacement energy and capacity for retiring resources. By July 2025, SPS selected a portfolio of 3,121 MW of accredited capacity resources, including wind, solar, storage, and natural gas, and plans to make regulatory filings for asset approvals in 2025, with expectations for approval in 2026. This strategic move is expected to enhance SPS’s operational capacity and compliance with renewable standards, impacting its industry positioning and stakeholder interests.

Business Operations and StrategyRegulatory Filings and Compliance
Xcel Energy Seeks $44 Million Rate Increase
Negative
Jun 30, 2025

On June 30, 2025, Northern States Power Company, a subsidiary of Xcel Energy, filed for a $44 million electric rate increase with the South Dakota Public Utilities Commission, aiming for a 15% hike based on a 2024 test year. If approved, this would lead to a 3% average annual residential bill increase over 2016-2026, potentially impacting stakeholders and the company’s financial positioning.

Executive/Board Changes
Xcel Energy Appoints New Chief Legal Officer
Neutral
Jun 16, 2025

On June 13, 2025, Xcel Energy announced that Rob Berntsen, Executive Vice President, Chief Legal and Compliance Officer, would be leaving the company to pursue another opportunity. Ryan Long, who has been with Xcel Energy since 2015 and served in various legal roles, was promoted to fill Berntsen’s position effective June 16, 2025. Long will also continue his role as President of Northern States Power Company while a search for his successor is conducted.

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: Aug 22, 2025