The Pennsylvania Public Utility Commission has put PPL (PPL)’s proposed annual revenue increase under review, pausing the company’s planned rate hike for nearly 1.5 million customers while a formal investigation unfolds.
See our latest analysis for PPL.
Shares of PPL have experienced a steady climb this year, with a 16.1% share price gain year-to-date and a robust 18.9% total shareholder return over the past twelve months. The recent regulatory developments, alongside upcoming earnings and prior progress in Kentucky, have kept investor sentiment leaning optimistic. Momentum appears to be building in the longer term, as reflected by a strong 56% three-year total shareholder return.
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After a sharp run-up in recent months, the key question now is whether PPL’s current valuation still offers room for upside, or if robust expectations have already priced in the next leg of growth. Is there a genuine buying opportunity left for investors?
PPL finished the trading session at $37.35 while the most widely followed narrative places its fair value noticeably higher. The market seems to be at odds with analysts on what the next leg looks like for the stock.
Major planned grid infrastructure upgrades and generation capacity expansions, totaling $20B through 2028 (with upside from potential data center-driven transmission and new generation projects), set the stage for nearly 10% average annual rate base growth. This directly supports higher regulated revenues and future earnings. The company’s new joint venture with Blackstone Infrastructure, targeting contracted, “regulated-like” generation for hyperscalers, provides a significant new avenue for capital deployment and value creation that is not yet fully captured in consensus. This has the potential to drive long-term earnings above base guidance as these projects come online.
Want to peek behind the curtain of this bullish valuation? A future profit jump and ambitious capital outlay are baked into the price. Can these bold projections really push PPL to new highs? The numbers behind this narrative might just surprise you.
Result: Fair Value of $39.92 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, investors should be mindful that unexpected regulatory delays or slower than hoped demand growth could still put PPL’s bullish outlook at risk.
