Value
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.7 |
| P/S | 8.7 |
| EV/EBITDA | 5.0 |
| Fwd P/E | 7.1 |
| PEG | 3.7 |
| Analyst target | 3.0 |
- ▸Forward P/E: 17.6x
- ▸PEG: 3.05
ED · Why this verdict
Why Consolidated Edison (ED) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.2/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The business faces two simultaneous high-severity concentration risks — a single state regulator controls the majority of authorized returns, and a single metropolitan area drives the bulk of demand — leaving the company especially vulnerable to adverse rate-case decisions or local economic shocks. Bear case | Quarterly EPS consistently exceeds $2.27 for 3 consecutive quarters — above the level at which the company most recently missed — demonstrating that concentrated regulatory and geographic exposure has not constrained earnings recovery. | →Stable |
| CounterA monopoly utility in the country's largest city is unlikely to face existential regulatory risk; regulators and utilities are mutually dependent, and a constructive long-term rate-case history can make concentrated franchise exposure a stability feature rather than a vulnerability. | ||
Free cash flow is negative — running at -39% relative to net income — meaning the utility is not converting reported earnings into cash; for a business that depends on steady cash generation to fund its dividend and capital reinvestment program, this is a meaningful structural concern. Quality breakdown | Free cash flow turns positive and represents at least 50% of net income for 2 consecutive fiscal years. | →Stable |
| CounterRegulated utilities are capital-intensive by design and routinely fund infrastructure through debt rather than operating cash flow; negative FCF in a rate-regulated environment may reflect a constructive infrastructure investment cycle, with future rate increases designed to recover the capital deployed over time. | ||
The stock is currently trading above the analyst consensus take-profit target, meaning the conventional upside case has been realized and the risk/reward has flipped — there is no remaining headroom to the target, only downside risk to a meaningful correction. Price targets | Analyst consensus target is raised above $120.00 over the next 12 months, restoring meaningful upside from current prices. | →Stable |
| CounterUtility stocks frequently trade above near-term analyst targets during periods of elevated demand for yield and rate-sensitive assets; if interest rates decline, target re-ratings and multiple expansion can push prices and targets higher in tandem, making the current premium less durable as a negative signal. | ||
The dividend carries a specific yield trap warning — flagging the payout as high but potentially uncovered — suggesting the income story that typically attracts utility investors may rest on a less secure foundation than the headline yield implies. Catalyst breakdown | Annual EPS exceeds $7.00 for 2 consecutive fiscal years, providing coverage above current reported earnings levels and demonstrating the dividend is well-supported. | →Stable |
| CounterMany regulated utilities have maintained dividends through capital investment cycles as regulators allow earnings recovery in subsequent rate periods; the current negative FCF may be a transient phase rather than a permanent impairment of payout capacity. | ||
The business faces two simultaneous high-severity concentration risks — a single state regulator controls the majority of authorized returns, and a single metropolitan area drives the bulk of demand — leaving the company especially vulnerable to adverse rate-case decisions or local economic shocks.
→StableBear case
- Expectation
- Quarterly EPS consistently exceeds $2.27 for 3 consecutive quarters — above the level at which the company most recently missed — demonstrating that concentrated regulatory and geographic exposure has not constrained earnings recovery.
CounterA monopoly utility in the country's largest city is unlikely to face existential regulatory risk; regulators and utilities are mutually dependent, and a constructive long-term rate-case history can make concentrated franchise exposure a stability feature rather than a vulnerability.
Free cash flow is negative — running at -39% relative to net income — meaning the utility is not converting reported earnings into cash; for a business that depends on steady cash generation to fund its dividend and capital reinvestment program, this is a meaningful structural concern.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive and represents at least 50% of net income for 2 consecutive fiscal years.
CounterRegulated utilities are capital-intensive by design and routinely fund infrastructure through debt rather than operating cash flow; negative FCF in a rate-regulated environment may reflect a constructive infrastructure investment cycle, with future rate increases designed to recover the capital deployed over time.
The stock is currently trading above the analyst consensus take-profit target, meaning the conventional upside case has been realized and the risk/reward has flipped — there is no remaining headroom to the target, only downside risk to a meaningful correction.
→StablePrice targets
- Expectation
- Analyst consensus target is raised above $120.00 over the next 12 months, restoring meaningful upside from current prices.
CounterUtility stocks frequently trade above near-term analyst targets during periods of elevated demand for yield and rate-sensitive assets; if interest rates decline, target re-ratings and multiple expansion can push prices and targets higher in tandem, making the current premium less durable as a negative signal.
The dividend carries a specific yield trap warning — flagging the payout as high but potentially uncovered — suggesting the income story that typically attracts utility investors may rest on a less secure foundation than the headline yield implies.
→StableCatalyst breakdown
- Expectation
- Annual EPS exceeds $7.00 for 2 consecutive fiscal years, providing coverage above current reported earnings levels and demonstrating the dividend is well-supported.
CounterMany regulated utilities have maintained dividends through capital investment cycles as regulators allow earnings recovery in subsequent rate periods; the current negative FCF may be a transient phase rather than a permanent impairment of payout capacity.
TrendMatrix Research · core thesis
Engine thesis — one sentence
The stock has traded past its analyst consensus target, leaving negative implied upside from current levels; a recent earnings miss, deeply negative free cash flow, a high yield flagged as potentially uncovered, and concentrated exposure to a single state regulator and metropolitan area combine to produce an unfavorable risk/reward that supports reducing the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.9 |
| ROA | 2.1 |
| Gross margin | 6.6 |
| Op margin | 10.0 |
| Net margin | 6.3 |
| Current ratio | 4.6 |
| FCF quality | 0.0 |
| Moat | 5.8 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: -39% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
4.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.0 |
| EPS growth | 4.6 |
Momentum
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.3 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 2.7 |
- ▸Overbought (RSI 75)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.5 |
| erm sentiment | 4.8 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider buying — $107 (0.000% of mkt cap)
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.8 |
| quality rank | 3.2 |
| growth rank | 3.8 |
Technical
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.1 |
| 52w position | 9.8 |
| gap | 5.0 |
Risk (lower is worse)
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.7 |
| days to cover | 5.4 |
| volatility | 8.3 |
| put call | 10.0 |
| implied vol | 5.4 |
| beta | 10.0 |
| debt equity | 4.9 |
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 3.7 |
| dividend safety | 4.8 |
- ▸Strong earnings: 3B/1M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:7.2>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:33d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.3=NEGATIVE
Warning (1)
- 8K_FLAG:1.02
Reward-to-Risk
-1.33
Upside
-13.1%
Downside
9.8%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.7 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Risk (lower is worse) at 7.4) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.3=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.33 — supplementary context, not the trigger for this path.
The strongest dimensions are Risk (lower is worse) at 7.4, Momentum at 7.2, and Value at 5.5; the weakest are Technical at 3.7, Growth at 4.3, and Peer rank at 4.5. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -1.33 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Stock Above Analyst Target
Trip ifUpside to analyst consensus target exceeds 10% through a lower stock price or a higher consensus estimate.
- P2Regulatory Geographic Concentration
Trip ifQuarterly EPS exceeds $2.27 for 3 consecutive quarters, recovering above the level the company most recently missed.
- P3Negative Free Cash Flow Earnings Quality
Trip ifFree cash flow rises above $0 for 2 consecutive fiscal years.
- P4Dividend Yield Trap Risk
Trip ifAnnual EPS exceeds $7.00 for 2 consecutive fiscal years.