DUK - Embedded Expectations Analysis - 2020 08 11
Duke Energy Corporation (DUK:USA) currently trades above corporate averages relative to UAFRS-based (Uniform) earnings, with a 33.1x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about their North Carolina and Indiana rate cases, cost reduction, and resource utilizationSpecifically, management may lack confidence in their ability to efficiently utilize their resources, sustain adjusted EPS, and strategically manage and lower costs. Furthermore, they may have concerns about the sustainability of their financial plans, the erosion of revenue, and potential deferral costs. In addition, they may lack confidence in their workers' ability to come back to work, their expectations for economic recovery, and their ability to address the needs of the business. They may also have concerns about the forecasted regulatory lag in North Carolina, the effectiveness of consolidating two cases in the Carolinas, and the expected order for their Indiana rate cases. Finally, they may be overstating their ability to sustain newfound efficiencies, and they may have concerns about the impact of the budgeted workforce increase to their business and vegetation spending management
Duke Energy is a holding company. Through its subsidiaries, the company operates as an energy company. The company's segments include: Electric Utilities and Infrastructure, which provides retail electric service through the generation, transmission, distribution and sale of electricity to customers within the Southeast and Midwest regions of the United States; Gas Utilities and Infrastructure, which conducts natural gas operations, as well as owns, operates and has investments in various pipeline transmission and natural gas storage facilities; and Commercial Renewables, which acquires, develops, builds, operates and owns wind and solar renewable generation throughout the continental United States.
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