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PPL vs. EXC: Which Utility Power Supply Stock Has More Upside?
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Key Takeaways
PPL leads EXC in earnings estimates, net profit margins and lower debt reliance, strengthening its appeal.
PPL's $23B capital plan targets 10.3% annual rate-base growth, while EXC's $41.7B plan supports 7.9% growth.
EXC offers a 3.75% dividend yield compared with PPL's 3.25%.
The Zacks Utility-Electric Power industry offers a compelling investment opportunity, underpinned by stable cash flows and the predictable earnings associated with regulated business models. Long-term contractual arrangements and regulated rate structures provide revenue visibility while limiting exposure to economic volatility. Moreover, a predominantly domestic operating footprint, rising electricity demand and ongoing investments in infrastructure modernization are strengthening operational efficiency and supporting steady earnings growth. These favorable industry dynamics also enhance utilities’ ability to maintain consistent dividend payments, making the sector appealing to income-focused investors.
PPL Corporation (PPL - Free Report) and Exelon Corporation (EXC - Free Report) are two prominent U.S. regulated utility companies focused on delivering essential electricity services to millions of customers. Both companies generate relatively predictable revenues through regulated utility operations, making them attractive candidates for investors seeking stable earnings, dividend income and long-term capital appreciation.
PPL Corporation presents a compelling investment opportunity, supported by its extensive capital investment program, expanding rate base and growing electricity demand. The company’s $23 billion capital plan for 2026-2029 is expected to drive approximately 10.3% average annual rate-base growth through 2029. Investments in transmission, distribution and grid modernization should enhance reliability and support long-term earnings growth. Rising data-center demand across Pennsylvania and Kentucky further strengthens its growth prospects, creating opportunities for additional regulated infrastructure and generation investments.
PPL’s improving regulatory environment reinforces its investment appeal, with favorable rate outcomes and recovery mechanisms supporting timely cost recovery and reducing regulatory lag. The company’s disciplined financing strategy, coupled with its focus on maintaining healthy credit metrics, provides financial flexibility to execute the investment plans. Moreover, its targeted annual dividend growth of 4-6% through 2029 underscores management’s commitment to shareholder returns, making PPL an attractive option for income-oriented investors seeking steady long-term growth.
Exelon also presents a compelling investment opportunity, supported by its regulated utility operations, stable revenue streams and extensive infrastructure investment plans. The company’s $41.7 billion capital program for 2026-2029 is expected to drive 7.9% rate-base growth, providing a solid foundation for long-term earnings expansion. Its growing data-center pipeline, including approximately 11 GW of high-probability load, creates additional opportunities for transmission and distribution investments. Moreover, effective revenue decoupling mechanisms and consistent operational reliability enhance earnings predictability and strengthen its competitive position.
Exelon’s disciplined cost management, favorable regulatory mechanisms and financial flexibility further support its growth prospects. Management expects adjusted operating EPS growth near the upper end of its 5-7% target range through 2029, alongside annual dividend growth of 5%. Continued investments in grid modernization, coupled with strong cost-recovery mechanisms and a diversified service territory, position Exelon to deliver sustainable earnings growth and dependable shareholder returns.
As both PPL and Exelon are leading utility players, comparing their fundamentals can help determine the more compelling investment opportunity.
PPL & EXC Earnings Estimates Movement
The Zacks Consensus Estimate for PPL’s 2026 and 2027 earnings per share (EPS) indicates a year-over-year increase of 7.18% and 8.76%, respectively. Long-term (three to five years) earnings growth is currently pegged at 5.26%.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for EXC’s 2026 and 2027 EPS indicates a year-over-year increase of 3.25% and 6.57%, respectively. Long-term earnings growth is currently pegged at 6.39%.
Image Source: Zacks Investment Research
Net Profit Margin
Net profit margin measures how efficiently a company converts revenues into profit after all expenses, offering insight into its overall profitability and financial health.
PPL’s net margin is 14.74% compared with EXC’s 11.23%.
Image Source: Zacks Investment Research
Debt to Capital Ratio
The debt-to-capital ratio is a vital indicator of the financial position of a company. The indicator shows the amount of debt used to run a business. Utilities generally have a large volume of debt on their balance sheet, as internal sources of funds are often insufficient to accommodate their funding requirements. Recently, Federal Reserve chair Kevin Warsh formally announced the much-anticipated benchmark interest rate hike by 25 basis points, taking the funds rate in the range of 3.75% to 4%.
PPL and EXC have a debt-to-capital of 57.46% and 63.95%, respectively, compared with the industry’s 62.33%.
Image Source: Zacks Investment Research
PPL & EXC’s Dividend Yield
Regulated utility companies generally distribute dividends and increase shareholders’ value.
Currently, the dividend yield for PPL is 3.25% compared with the industry’s 3.04% and the same for Exelon is 3.75%. Both companies have raised dividends five times in the past year.
Return on Equity
Return on Equity (“ROE”) is an essential financial indicator that evaluates a company’s efficiency in generating profits from the equity invested by its shareholders. It demonstrates how well management is utilizing the capital provided to increase earnings and deliver value.
PPL’s current ROE is 9.33% compared with EXC’s 9.81%.
Image Source: Zacks Investment Research
PPL and EXC’s Valuation
PPL currently appears to be trading at a premium compared with EXC on a Price/Earnings Forward 12-month basis. (P/E- F12M).
PPL is currently trading at 16.83X, compared with EXC’s 14.83X. The industry is presently trading at 16.56X.
Image Source: Zacks Investment Research
Summing Up
PPL and Exelon are making substantial investments in electric grid modernization, transmission and distribution infrastructure, system reliability and capacity expansion to meet growing electricity demand. Both utility companies serve millions of customers across their respective service territories, focusing on improving operational efficiency and ensuring reliable power delivery.
The comparative analysis indicates that these two utility giants are closely matched across several key financial and operational metrics, although each demonstrates strengths in certain areas. However, PPL holds an advantage over Exelon in terms of improving earnings estimates, higher net profit margins and lower reliance on debt to finance its operations. Considering these favorable fundamentals, PPL appears better positioned than Exelon to capitalize on emerging growth opportunities and deliver stronger shareholder returns.
Consequently, PPL, with a Zacks Rank #2 (Buy), emerges as the more attractive investment option, offering greater upside potential than EXC, which has a Zacks Rank #3 (Hold) at present.
View the Zacks #1 Rank List
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PPL vs. EXC: Which Utility Power Supply Stock Has More Upside?
Key Takeaways
The Zacks Utility-Electric Power industry offers a compelling investment opportunity, underpinned by stable cash flows and the predictable earnings associated with regulated business models. Long-term contractual arrangements and regulated rate structures provide revenue visibility while limiting exposure to economic volatility. Moreover, a predominantly domestic operating footprint, rising electricity demand and ongoing investments in infrastructure modernization are strengthening operational efficiency and supporting steady earnings growth. These favorable industry dynamics also enhance utilities’ ability to maintain consistent dividend payments, making the sector appealing to income-focused investors.
PPL Corporation (PPL - Free Report) and Exelon Corporation (EXC - Free Report) are two prominent U.S. regulated utility companies focused on delivering essential electricity services to millions of customers. Both companies generate relatively predictable revenues through regulated utility operations, making them attractive candidates for investors seeking stable earnings, dividend income and long-term capital appreciation.
PPL Corporation presents a compelling investment opportunity, supported by its extensive capital investment program, expanding rate base and growing electricity demand. The company’s $23 billion capital plan for 2026-2029 is expected to drive approximately 10.3% average annual rate-base growth through 2029. Investments in transmission, distribution and grid modernization should enhance reliability and support long-term earnings growth. Rising data-center demand across Pennsylvania and Kentucky further strengthens its growth prospects, creating opportunities for additional regulated infrastructure and generation investments.
PPL’s improving regulatory environment reinforces its investment appeal, with favorable rate outcomes and recovery mechanisms supporting timely cost recovery and reducing regulatory lag. The company’s disciplined financing strategy, coupled with its focus on maintaining healthy credit metrics, provides financial flexibility to execute the investment plans. Moreover, its targeted annual dividend growth of 4-6% through 2029 underscores management’s commitment to shareholder returns, making PPL an attractive option for income-oriented investors seeking steady long-term growth.
Exelon also presents a compelling investment opportunity, supported by its regulated utility operations, stable revenue streams and extensive infrastructure investment plans. The company’s $41.7 billion capital program for 2026-2029 is expected to drive 7.9% rate-base growth, providing a solid foundation for long-term earnings expansion. Its growing data-center pipeline, including approximately 11 GW of high-probability load, creates additional opportunities for transmission and distribution investments. Moreover, effective revenue decoupling mechanisms and consistent operational reliability enhance earnings predictability and strengthen its competitive position.
Exelon’s disciplined cost management, favorable regulatory mechanisms and financial flexibility further support its growth prospects. Management expects adjusted operating EPS growth near the upper end of its 5-7% target range through 2029, alongside annual dividend growth of 5%. Continued investments in grid modernization, coupled with strong cost-recovery mechanisms and a diversified service territory, position Exelon to deliver sustainable earnings growth and dependable shareholder returns.
As both PPL and Exelon are leading utility players, comparing their fundamentals can help determine the more compelling investment opportunity.
PPL & EXC Earnings Estimates Movement
The Zacks Consensus Estimate for PPL’s 2026 and 2027 earnings per share (EPS) indicates a year-over-year increase of 7.18% and 8.76%, respectively. Long-term (three to five years) earnings growth is currently pegged at 5.26%.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for EXC’s 2026 and 2027 EPS indicates a year-over-year increase of 3.25% and 6.57%, respectively. Long-term earnings growth is currently pegged at 6.39%.
Image Source: Zacks Investment Research
Net Profit Margin
Net profit margin measures how efficiently a company converts revenues into profit after all expenses, offering insight into its overall profitability and financial health.
PPL’s net margin is 14.74% compared with EXC’s 11.23%.
Image Source: Zacks Investment Research
Debt to Capital Ratio
The debt-to-capital ratio is a vital indicator of the financial position of a company. The indicator shows the amount of debt used to run a business. Utilities generally have a large volume of debt on their balance sheet, as internal sources of funds are often insufficient to accommodate their funding requirements. Recently, Federal Reserve chair Kevin Warsh formally announced the much-anticipated benchmark interest rate hike by 25 basis points, taking the funds rate in the range of 3.75% to 4%.
PPL and EXC have a debt-to-capital of 57.46% and 63.95%, respectively, compared with the industry’s 62.33%.
Image Source: Zacks Investment Research
PPL & EXC’s Dividend Yield
Regulated utility companies generally distribute dividends and increase shareholders’ value.
Currently, the dividend yield for PPL is 3.25% compared with the industry’s 3.04% and the same for Exelon is 3.75%. Both companies have raised dividends five times in the past year.
Return on Equity
Return on Equity (“ROE”) is an essential financial indicator that evaluates a company’s efficiency in generating profits from the equity invested by its shareholders. It demonstrates how well management is utilizing the capital provided to increase earnings and deliver value.
PPL’s current ROE is 9.33% compared with EXC’s 9.81%.
Image Source: Zacks Investment Research
PPL and EXC’s Valuation
PPL currently appears to be trading at a premium compared with EXC on a Price/Earnings Forward 12-month basis. (P/E- F12M).
PPL is currently trading at 16.83X, compared with EXC’s 14.83X. The industry is presently trading at 16.56X.
Image Source: Zacks Investment Research
Summing Up
PPL and Exelon are making substantial investments in electric grid modernization, transmission and distribution infrastructure, system reliability and capacity expansion to meet growing electricity demand. Both utility companies serve millions of customers across their respective service territories, focusing on improving operational efficiency and ensuring reliable power delivery.
The comparative analysis indicates that these two utility giants are closely matched across several key financial and operational metrics, although each demonstrates strengths in certain areas. However, PPL holds an advantage over Exelon in terms of improving earnings estimates, higher net profit margins and lower reliance on debt to finance its operations.
Considering these favorable fundamentals, PPL appears better positioned than Exelon to capitalize on emerging growth opportunities and deliver stronger shareholder returns.
Consequently, PPL, with a Zacks Rank #2 (Buy), emerges as the more attractive investment option, offering greater upside potential than EXC, which has a Zacks Rank #3 (Hold) at present.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.