Exelon beats estimates, outlines $41.3B infrastructure investment
Utility projects 5-7% earnings growth through 2029 as it modernizes grid
Exelon Corporation reported fourth-quarter adjusted earnings of $0.59 per share, exceeding analyst expectations by 11.3%, as the Chicago-based utility operator unveiled a four-year capital investment plan totaling $41.3 billion to modernize energy infrastructure across its service territories.
The results, released before market open on Thursday, sent shares up 2.2% in pre-market trading. Full-year 2025 adjusted earnings reached $2.77 per share, while the company initiated 2026 guidance of $2.81 to $2.91 per share, representing growth of more than 6% from the prior year.
"We delivered another strong year of operational and financial performance while making significant investments to support our customers and communities," said Calvin Butler, Exelon's chief executive officer, in the earnings announcement. "Our 2026 financial outlook reflects the strength of our diversified utilities business and our confidence in our ability to execute on our growth plans."
The comprehensive capital expenditure plan spanning 2026 through 2029 is expected to drive a 7.9% annual rate base growth, a key metric for utility investors that reflects the value of assets on which the company can earn a regulated return. Management is targeting operating earnings per share growth near the top end of a 5-7% compound annual growth rate from 2025 through 2029.
The substantial investment focuses on grid modernization, reliability enhancements, and supporting increasing demand from electrification initiatives and data center expansion. Exelon's utility operations serve approximately 10 million customers across six states and the District of Columbia, positioning the company as a critical player in the United States' energy transition.
Analysts had mixed views heading into the earnings release, with Wall Street maintaining a "Moderate Buy" consensus and an average target price of $48.75, according to market data. The stock currently trades at $44.45 with a dividend yield of 3.6%.
The strong earnings report comes amid growing political scrutiny of utility rates across the industry. Record-high capacity prices in PJM Interconnection's recent auctions have led to surging electricity bills in Exelon's service territories, prompting concerns about affordability.
In response, Exelon announced a $10 million customer relief contribution in January, bringing total assistance to $60 million over the past year. The company has emphasized customer affordability as a "paramount strategy" while advocating for policies that promote energy equity and supply solutions.
Some analysts have flagged political risk as a potential headwind. Steve Fleishman of Wolfe Research downgraded the stock to "Hold" in late January, citing these affordability concerns. However, Julien Dumoulin-Smith at Jefferies maintained a "Buy" rating, pointing to the company's strong capital plans and growth opportunities.
The $41.3 billion investment program represents a significant increase from Exelon's previous capital deployment and underscores the growing need for grid infrastructure investment as the U.S. energy system undergoes rapid transformation. Utility companies nationwide are facing pressure to upgrade aging infrastructure while accommodating renewable energy integration and meeting rising electricity demand from electric vehicles, data centers, and electrification initiatives.
Exelon's portfolio includes nuclear, solar, and wind generation assets, giving the company exposure to both traditional regulated utility earnings and merchant power markets. The company's focus on reliability and compliance with regulatory standards has positioned it as a stable, income-generating investment for institutional investors, who own approximately 91% of outstanding shares.
Looking ahead, investors will be monitoring management's execution on the capital plan and ability to navigate the charged political environment around electricity pricing. Upcoming rate case filings and multi-year rate plan negotiations across Exelon's service territories will serve as key catalysts for the stock in 2026.
The company's earnings conference call is scheduled for 10:00 AM ET Thursday, where executives are expected to provide additional detail on the capital allocation strategy and address questions about the regulatory landscape affecting the utility sector.