Exelon Corporation EXC
Verdict: Sell. Fair value $41.27 against a price of $43.30 on 12 Jan 2026, 5% below the price.
In plain words
The case for: Wide competitive moat provides durability. Market leadership enables pricing power. Revenue beats.
The case against: Receivables increased 16.9% (from $2.34B to $2.74B) while Revenue only grew 6.0% (from $21.73B to.... Long-term debt increased by $3.25B (+8.1%) year-over-year, outpacing asset growth slightly. Common.... Growth slows.
Main risks
- Downside survival at risk: 11 months runway
- Potential/actual debt covenant breach
- Thin revenue cushion: 0.2% decline causes EBIT loss
- Persistent Negative Free Cash Flow: TTM FCF is -$1.59B, continuing a multi-year trend of heavy cash consumption driven by CapEx ($8.03B) far exceeding Operating Cash Flow ($6.44B).
- High and Risky Leverage: Net Debt/EBITDA at 5.04x and Debt/Equity at 1.66 are elevated, even for a capital-intensive utility, increasing financial risk.
- Receivables increased 16.9% (from $2.34B to $2.74B) while Revenue only grew 6.0% (from $21.73B to $23.03B). This creates a drag on cash flow and raises the DSRI component of the M-Score.