Exelon Corporation’s EXC systematic investment should strengthen its transmission and distribution infrastructure and assist in providing reliable services to its customers. Exelon's initiatives in grid modernization are likely to improve the resilience of its operations. Given its growth opportunities, EXC makes for a solid investment option in the utility sector.

Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.

EXC’s Growth Projections & Surprise History

The Zacks Consensus Estimate for 2025 earnings per share (EPS) has increased 1.1% to $2.66 in the past 60 days.

The Zacks Consensus Estimate for 2025 sales is pinned at $23.99 billion, indicating a year-over-year increase of 4.2%.

Exelon's long-term (three to five years) earnings growth rate is 5.99%. The company delivered a trailing four-quarter average earnings surprise of 7.6%.

EXC’s Solvency

The time-to-interest earned ratio at the end of the fourth quarter of 2024 was 2.4. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.

EXC’s Dividend Growth

Exelon’s stable performance and cash flows allow it to reward its shareholders through continuous dividend payments. Management declared a quarterly dividend of 40 cents per share for first-quarter 2025, resulting in an annualized dividend of $1.60.

The company aims to increase dividend per share at the low end of its targeted 5-7% range annually through 2028, subject to the approval of its board of directors. Exelon is projecting a long-term dividend payout ratio of 60%, which is in sync with the long-term dividend growth target. Its current dividend yield is 3.41%, better than the Zacks S&P 500 composite's average of 1.38%.

EXC’s Focus on Strategic Investments

Exelon invests substantially in infrastructure projects and plans to invest nearly $38 billion during 2025-2028 in regulated utility operations. The new capital expenditure indicates a 10% increase from the prior plan and will be utilized to support customer needs and grid reliability. The company is set to invest $21.7 billion in electric distribution, $12.6 billion in electric transmission and $3.8 billion in gas delivery in the 2025-2028 period.

EXC’s Share Price Performance

In the past three months, the stock has returned 19.1% compared with the industry’s growth of 1.8%.

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Other Stocks to Consider

A few other top-ranked stocks from the same industry are Consolidated Edison ED, NiSource NI and CenterPoint Energy CNP, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

ED’s long-term earnings growth rate is 5.57%. The Zacks Consensus Estimate for 2025 EPS implies an improvement of 4.1% from the bottom line recorded in 2024.

NI’s long-term earnings growth rate is 7.91%. The Zacks Consensus Estimate for 2025 EPS implies an improvement of 6.9% from the bottom line recorded in 2024.

CNP’s long-term earnings growth rate is 7.49%. The Zacks Consensus Estimate for 2025 EPS indicates year-over-year growth of 8%.

 

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This article originally published on Zacks Investment Research (zacks.com).

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