Back to top

Image: Bigstock

Duke Energy Stock Rises 11.7% in 3 Months: Should You Buy Now?

Read MoreHide Full Article

Key Takeaways

  • DUK stock rose 11.7% in three months, outpacing the utility-electric power industry's 9.3% gain.
  • Duke Energy plans major solar, wind and storage additions to expand its renewable energy footprint.
  • Strong nuclear fleet and steady EPS growth projections support dividends and long-term outlook.

Duke Energy (DUK - Free Report) shares have gained 11.7% over the past three months compared with the Zacks Utility-Electric Power industry’s growth of 9.3%. DUK remains a premier utility service provider that actively pursues nuclear energy expansion as part of its long-term clean energy strategy.
 

Zacks Investment Research
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 15.5% and 10.7%, respectively, over the aforementioned period. NextEra Energy benefits from its strategic investments and expansion of renewable portfolio. NEE’s diverse portfolio of assets include natural gas, wind, solar, nuclear generation facilities and battery storage facilities. Southern Company owns membership interests in SCS, Southern Linc, Southern Holdings, Southern Nuclear, PowerSecure, and other direct and indirect subsidiaries. Notably, Southern Nuclear provides services to SO’s nuclear power plants and recently brought Vogtle Units 3 and 4 online, which are co-owned by Georgia Power.

Given its recent price outperformance, should you consider adding Duke Energy to your portfolio? Let’s examine the key factors and assess its investment prospects.

Factors Driving DUK Stock’s Performance

Duke Energy is gaining momentum through its broad energy mix and 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 services for its customers.

DUK aims to significantly expand its renewable portfolio, with plans to add 4,000 MW of solar annually in the Carolinas starting in 2027 and 900 MW per year in Florida. The company is targeting 4,000 MW of solar and 5,600 MW of battery storage in the Carolinas by 2034. It also plans to bring 1,200 MW of onshore wind online by 2033 and develop 800-1,100 MW of offshore wind by 2034, scaling up to 2,200-2,400 MW by 2035. These initiatives should enhance its position in the expanding renewable energy space.

Nuclear energy has always played an essential role in meeting Duke Energy's customers' rapidly growing and evolving energy demands, with its six plants providing more than 96% of the company's clean energy. The license renewal at all its reactors, once achieved, will enable DUK to continue supplying its customers with reliable, non-emitting and cost-efficient nuclear power over the long run. This will also help maintain its position of having the largest regulated nuclear fleet in the United States, with a total generation capacity of around 11 gigawatts (GW).

DUK Stock’s Earnings Estimate

The Zacks Consensus Estimate for DUK’s 2026 and 2027 earnings per share (EPS) indicates an increase of 6.34% and 6.46%, respectively, year over year.
 

Zacks Investment Research
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for NextEra Energy’s 2026 and 2027 EPS indicates an increase of 7.82% and 8.88%, respectively, year over year. The Zacks Consensus Estimate for Southern Company’s 2026 and 2027 EPS indicates an increase of 6.74% and 7.5%, respectively, year over year.

DUK Stock’s Earnings Surprise History

Duke Energy beat on earnings in three of the trailing four quarters and missed in one, delivering an average surprise of 4.77%.

 

Zacks Investment Research
Image Source: Zacks Investment Research

DUK’s Dividend History

The company’s consistently strong performance has enabled it to reward shareholders through regular dividend increases. Currently, Duke Energy pays an annual dividend of $4.26 per share. 

DUK targets a dividend payout ratio in the range of 60-70% and is expected to continue raising its dividend, supported by sustained earnings growth. Check Duke Energy’s dividend history here.

DUK’s ROE Lower Than the Industry

Duke Energy’s trailing 12-month return on equity of 9.67% is lower than the industry average of 10.82%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders’ funds to generate income.

 

Zacks Investment Research
Image Source: Zacks Investment Research

DUK Stock Trades at a Discount

Duke Energy is currently trading at 3.05X, a discount compared to its industry’s 3.73X on a forward 12-month P/S basis.

 

Zacks Investment Research
Image Source: Zacks Investment Research

Summing Up

Duke Energy is strengthening its growth outlook through a diversified energy mix, combining renewables with conventional sources to ensure reliable and sustainable power delivery. Ongoing renewable expansion and a strong nuclear fleet position the company to meet rising demand while reinforcing its leadership in clean and dependable energy generation.

Considering its earnings growth projection, better price performance, attractive valuation and regular dividends, investors may consider adding this stock to their portfolio right now. DUK holds a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 

Zacks' 7 Best Strong Buy Stocks (New Research Report)

Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.

Click Here, It's Really Free

Published in