WEC
WEC Energy Group, Inc.
$112.55
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 20.7% above fair value
You pay
$112.55
Bear
$81.58
Fair
$93.24
Bull
$104.89
Bear
$81.58
-27.5%
$5.00 × 14x P/E
Fair
$93.24
-17.2%
$5.00 × 16x P/E
Bull
$104.89
-6.8%
$5.00 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
22.5x
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 $124.29 from 35 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $93.24 per share.
Warnings
Dividend-based valuation: $162.04 (above our primary estimate by 103%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $124.29 (from 35 analysts). Our estimate is 36% 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