PEG
Public Service Enterprise Group Incorporated
$79.51
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 7.0% above fair value
You pay
$79.51
Bear
$65.01
Fair
$74.30
Bull
$83.59
Bear
$65.01
-18.2%
$4.21 × 14x P/E
Fair
$74.30
-6.6%
$4.21 × 16x P/E
Bull
$83.59
+5.1%
$4.21 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
18.9x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $90.50 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $74.30 per share.
Warnings
Wall Street's average price target is $90.50 (from 33 analysts). Our estimate is 26% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples