CHICAGO - Exelon Corporation (NASDAQ:EXC) reported a successful fourth quarter of 2023, with adjusted earnings per share (EPS) of $0.60, surpassing the analyst consensus estimate of $0.58 by $0.02. The company's performance reflects a year of strong operational achievements and financial discipline.
For the full year 2024, Exelon introduced an EPS guidance range of $2.40 to $2.50, aligning closely with the consensus estimate of $2.41. This forward-looking guidance indicates the company's confidence in its strategic investments and operational efficiency.
Exelon's GAAP Net Income from Continuing Operations for the fourth quarter increased to $0.62 per share from $0.43 per share in the same quarter of the previous year. The adjusted (non-GAAP) Operating Earnings for the quarter also saw a rise to $0.60 per share from $0.43 per share year-over-year (YoY). This growth is primarily attributed to higher utility earnings due to the favorable impacts of multi-year plans, including the recognition of the reconciliation in 2023 at BGE, and higher electric distribution earnings from increased allowed electric distribution Return on Equity (ROE) due to a rise in treasury rates at ComEd.
President and CEO Calvin Butler highlighted the company's achievements, stating, "Exelon had another strong year in 2023, both financially and operationally. We delivered in the top half of our guidance range, achieved best-on-record operational performance at multiple utilities, and advocated for a more affordable and equitable energy transformation for our customers."
Chief Financial Officer Jeanne Jones added, "We delivered strong financial results for the second year in a row, despite the historically mild weather impacting our non-decoupled jurisdictions. For the full year 2023, we earned $2.34 per share on a GAAP basis and $2.38 per share on an adjusted basis, results that are at the top end of our narrowed guidance range."
The company's shares responded positively to the news, reflecting investor satisfaction with the solid results and guidance provided for the upcoming year. This positive market reaction underscores the confidence in Exelon's strategic direction and its ability to generate value for shareholders.
Exelon's commitment to investing $35 billion in capital expenditures over the next four years is expected to meet customer needs effectively and contribute to a projected rate base growth of 7.5% and an operating EPS compounded annual growth of 5-7% from 2023 to 2027. These investments are designed to support Exelon's jurisdictions' energy transformations affordably and efficiently.
The company's utilities, including ComEd and PHI, ended the year with record performances in outage frequency and duration, demonstrating Exelon's focus on operational excellence and customer satisfaction.
Exelon's financial and operational success in the fourth quarter, coupled with its positive outlook for 2024, positions the company well for continued growth and leadership in the utility sector.
InvestingPro Insights
As Exelon Corporation (NASDAQ:EXC) wraps up a successful fourth quarter and looks ahead to 2024, InvestingPro data and analysis provide additional context to the company's financial health and future prospects. According to InvestingPro metrics, Exelon's market capitalization stands at $34.57 billion, reflecting its significant presence in the utility sector. The company's Price/Earnings (P/E) ratio, a key indicator of market expectations about the company's growth, is 16.26, aligning with industry standards. Notably, the adjusted P/E ratio for the last twelve months as of Q3 2023 is slightly lower at 15.96, suggesting a modestly more favorable valuation.
Exelon's commitment to shareholder returns is evident with a noteworthy InvestingPro Tip: the company has maintained dividend payments for 53 consecutive years. This consistency in rewarding investors is complemented by a current dividend yield of 4.15%, which is particularly attractive in today's market environment. Furthermore, the company's revenue growth over the last twelve months as of Q3 2023 stands at 11.63%, indicating a robust financial performance.
For those considering an investment in Exelon, it's worth noting an additional InvestingPro Tip: despite the company's solid dividend track record, it operates with a significant debt burden, and its short-term obligations exceed liquid assets. This could be a point of consideration for risk-averse investors. However, analysts predict that the company will remain profitable this year, which may provide some reassurance.
With these insights in mind, readers interested in a deeper analysis can explore more InvestingPro Tips to make informed decisions. There are 5 additional tips listed on InvestingPro for Exelon, which can be accessed at: https://www.investing.com/pro/EXC. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and gain a comprehensive understanding of Exelon's investment potential.
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