We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
DUK Stock Underperforms Industry in 6 Months: Here's How to Play
Read MoreHide Full Article
Key Takeaways
Duke Energy advances its clean-energy shift with coal retirements, new gas capacity and nuclear expansion.
The company plans $190-$200B in decade-long investments to modernize infrastructure and boost renewables.
DUK shows steady earnings growth, dividend hikes and a four-quarter streak of earnings beat.
Duke Energy (DUK - Free Report) shares have gained 5.7% over the past six months compared with the Zacks Utility-Electric Power industry’s growth of 11.9%. The company is benefiting from its growing renewable business and strategic investment plans.
Image Source: Zacks Investment Research
Shares of other operators in the same industry, NextEra Energy (NEE - Free Report) and The Southern Company (SO - Free Report) , have gained 23% and 1.3%, respectively, during the aforementioned period. NextEra Energy benefits from its strategic investments and expansion of renewable portfolio. Southern Company's five-year capital plan includes investments in new generation and grid modernization to support load growth. SO’s focus on regulated assets reduces merchant risk and provides a transparent pathway for earnings growth.
Given the current underperformance in price, should you consider including Duke Energy in your portfolio? Let's examine the factors in detail and assess the investment prospects.
Factors Driving the Performance of DUK Stock
Duke Energy is gaining momentum through its broad energy mix, ongoing investments in modern technology and infrastructure. By combining renewable resources such as solar and wind with conventional sources like nuclear, coal and natural gas, the company ensures reliable service for its customers.
DUK is rapidly advancing its clean-energy transition by planning to cut coal generation to under 5% by 2030 and fully eliminate coal by 2035, supported by retiring 58 coal units totaling 8,000 megawatt (MW). The company has also committed to net-zero methane emissions by 2030 and net-zero carbon emissions by 2050. To support this shift, it aims to add more than 7,500 MW of new, lower-emission natural-gas generation by 2030.
Duke Energy is currently focused on expanding its scale of operations, implementing modern technologies at its facilities as well as enhancing its renewable generation portfolio by investing heavily in infrastructure and expansion projects. To meet customer needs, the company currently anticipates spending capital worth $190-$200 billion over the next decade, a major portion of which will go to the clean energy transition.
DUK is pushing forward with plans to expand its nuclear portfolio as a key component of its long-term clean energy vision, especially in the Carolinas. In January 2025, the company partnered with GE Hitachi to support updates to the standard design and licensing of the BWRX-300 small modular reactor technology. This collaboration strengthens Duke Energy’s commitment to advanced nuclear solutions as a central pillar of its future clean energy strategy.
DUK Stock’s Earnings Estimate
The Zacks Consensus Estimate for DUK’s 2025 and 2026 earnings per share (EPS) indicates an increase of 7.29% and 6.07%, respectively, year over year.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NextEra Energy’s 2025 and 2026 EPS indicates an increase of 7.29% and 7.84%, respectively, year over year. The Zacks Consensus Estimate for Southern Company’s s 2025 and 2026 EPS indicates an increase of 5.68% and 7.24%, respectively, year over year.
DUK Stock’s Earnings Surprise History
Duke Energy beat on earnings in each of the trailing four quarters, delivering an average surprise of 5.72%.
Image Source: Zacks Investment Research
DUK’s Dividend History
The consistently strong performance of the company has enabled it to reward its shareholders through annual dividend rate hikes. Currently, its annual dividend is $4.26 per share.
Duke Energy’s targeted dividend payout ratio is in the range of 60-70%. It is anticipated that the company will continue to increase its dividend in the future, driven by its sustained earnings growth. Check Duke Energy’s dividend history here.
DUK’s ROE Higher Than the Industry
Duke Energy’s trailing 12-month return on equity of 9.98% is higher than the industry average of 9.64%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders’ funds to generate income.
Image Source: Zacks Investment Research
DUK Stock Trades at a Premium
Duke Energy is currently trading at 18.55X a premium compared to its industry’s 15.76X on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
NextEra Energy is trading at a 21.87X premium, while Southern Company is trading at an 19.96X premium compared with the industry’s forward 12-month P/E.
Summing Up
Duke Energy is accelerating its clean-energy transition through a diverse power mix, major infrastructure investments and a long-term commitment to modern technologies. The company’s strategic investments are also focused on expansion of clean energy. It is also expanding its nuclear capabilities, partnering with GE Hitachi to advance BWRX-300 SMR technology, solidifying nuclear as a core part of its future energy strategy.
However, the company’s premium valuation and lower return than the industry are concerning at the moment. The investors can hold onto this Zacks Rank #3 (Hold) stock and enjoy the benefits of regular dividends and earnings growth estimates. The new investors can wait and look for a better entry point.
Image: Bigstock
DUK Stock Underperforms Industry in 6 Months: Here's How to Play
Key Takeaways
Duke Energy (DUK - Free Report) shares have gained 5.7% over the past six months compared with the Zacks Utility-Electric Power industry’s growth of 11.9%. The company is benefiting from its growing renewable business and strategic investment plans.
Image Source: Zacks Investment Research
Shares of other operators in the same industry, NextEra Energy (NEE - Free Report) and The Southern Company (SO - Free Report) , have gained 23% and 1.3%, respectively, during the aforementioned period. NextEra Energy benefits from its strategic investments and expansion of renewable portfolio. Southern Company's five-year capital plan includes investments in new generation and grid modernization to support load growth. SO’s focus on regulated assets reduces merchant risk and provides a transparent pathway for earnings growth.
Given the current underperformance in price, should you consider including Duke Energy in your portfolio? Let's examine the factors in detail and assess the investment prospects.
Factors Driving the Performance of DUK Stock
Duke Energy is gaining momentum through its broad energy mix, ongoing investments in modern technology and infrastructure. By combining renewable resources such as solar and wind with conventional sources like nuclear, coal and natural gas, the company ensures reliable service for its customers.
DUK is rapidly advancing its clean-energy transition by planning to cut coal generation to under 5% by 2030 and fully eliminate coal by 2035, supported by retiring 58 coal units totaling 8,000 megawatt (MW). The company has also committed to net-zero methane emissions by 2030 and net-zero carbon emissions by 2050. To support this shift, it aims to add more than 7,500 MW of new, lower-emission natural-gas generation by 2030.
Duke Energy is currently focused on expanding its scale of operations, implementing modern technologies at its facilities as well as enhancing its renewable generation portfolio by investing heavily in infrastructure and expansion projects. To meet customer needs, the company currently anticipates spending capital worth $190-$200 billion over the next decade, a major portion of which will go to the clean energy transition.
DUK is pushing forward with plans to expand its nuclear portfolio as a key component of its long-term clean energy vision, especially in the Carolinas. In January 2025, the company partnered with GE Hitachi to support updates to the standard design and licensing of the BWRX-300 small modular reactor technology. This collaboration strengthens Duke Energy’s commitment to advanced nuclear solutions as a central pillar of its future clean energy strategy.
DUK Stock’s Earnings Estimate
The Zacks Consensus Estimate for DUK’s 2025 and 2026 earnings per share (EPS) indicates an increase of 7.29% and 6.07%, respectively, year over year.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NextEra Energy’s 2025 and 2026 EPS indicates an increase of 7.29% and 7.84%, respectively, year over year. The Zacks Consensus Estimate for Southern Company’s s 2025 and 2026 EPS indicates an increase of 5.68% and 7.24%, respectively, year over year.
DUK Stock’s Earnings Surprise History
Duke Energy beat on earnings in each of the trailing four quarters, delivering an average surprise of 5.72%.
Image Source: Zacks Investment Research
DUK’s Dividend History
The consistently strong performance of the company has enabled it to reward its shareholders through annual dividend rate hikes. Currently, its annual dividend is $4.26 per share.
Duke Energy’s targeted dividend payout ratio is in the range of 60-70%. It is anticipated that the company will continue to increase its dividend in the future, driven by its sustained earnings growth. Check Duke Energy’s dividend history here.
DUK’s ROE Higher Than the Industry
Duke Energy’s trailing 12-month return on equity of 9.98% is higher than the industry average of 9.64%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders’ funds to generate income.
Image Source: Zacks Investment Research
DUK Stock Trades at a Premium
Duke Energy is currently trading at 18.55X a premium compared to its industry’s 15.76X on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
NextEra Energy is trading at a 21.87X premium, while Southern Company is trading at an 19.96X premium compared with the industry’s forward 12-month P/E.
Summing Up
Duke Energy is accelerating its clean-energy transition through a diverse power mix, major infrastructure investments and a long-term commitment to modern technologies. The company’s strategic investments are also focused on expansion of clean energy. It is also expanding its nuclear capabilities, partnering with GE Hitachi to advance BWRX-300 SMR technology, solidifying nuclear as a core part of its future energy strategy.
However, the company’s premium valuation and lower return than the industry are concerning at the moment. The investors can hold onto this Zacks Rank #3 (Hold) stock and enjoy the benefits of regular dividends and earnings growth estimates. The new investors can wait and look for a better entry point.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.