Value
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.2 |
| P/S | 8.2 |
| EV/EBITDA | 3.9 |
| Fwd P/E | 7.3 |
| PEG | 3.1 |
| Analyst target | 5.0 |
- ▸Forward P/E: 17.0x
- ▸PEG: 3.95
PEG · Why this verdict
Why Public Service Enterprise (PEG) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.2/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Public Service Enterprise Group has beaten earnings estimates in all 4 recent quarters with a 7.9% average surprise and leads its peer group in both growth and ROE, but the stock has reached analyst targets with only 0.7% upside remaining and negative free cash flow signals capital intensity concerns.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
PSEG has beaten analyst EPS estimates in all 4 of the most recent quarters with an average surprise of 7.9%, demonstrating consistent execution in a regulated utility environment. Catalyst breakdown | EPS beats continue in at least 3 of the next 4 quarters with positive average surprise above 5%. | ↑Improving |
| CounterRegulated utility earnings are largely set by rate cases rather than operational performance; beat streaks in utilities often simply reflect conservative regulatory assumptions rather than management excellence. | ||
PSEG ranks as an industry growth leader among regulated utilities with a peer rank growth score of 9.0, outperforming on revenue and earnings growth versus its regulated electric utility peer group. Peer-rank breakdown | Revenue growth continues above 5% year-over-year and the company maintains its top-quartile peer growth ranking for the next 4 quarters. | →Stable |
| CounterGrowth leadership in a rate-regulated business is partially a function of approved capital expenditure programs; growth could stall if regulators deny or delay rate case filings. | ||
Free cash flow is negative at -8% relative to net income, meaning reported earnings exceed actual cash generation, which raises questions about the sustainability of the dividend and ongoing capital expenditure programs. Quality breakdown | Free cash flow turns positive within 2 fiscal years as major capital programs wind down and rate base investments begin generating authorized returns. | →Stable |
| CounterRegulated utilities with large capital expenditure programs routinely run negative near-term FCF while building rate base that earns authorized returns; negative FCF is often a bullish signal of future earnings growth in this sector. | ||
The stock is priced within 0.7% of analyst targets at $80.15 versus a take-profit of $80.68, providing no meaningful reward-to-risk at current entry levels. Warnings | Analyst targets are revised upward above $88 within 12 months as the utility rate base expansion is recognized in updated models. | →Stable |
| CounterUtility analyst targets update slowly after rate case decisions; a constructive rate case outcome could prompt simultaneous upgrades from multiple analysts, quickly reopening the upside case. | ||
PSEG has beaten analyst EPS estimates in all 4 of the most recent quarters with an average surprise of 7.9%, demonstrating consistent execution in a regulated utility environment.
↑ImprovingCatalyst breakdown
- Expectation
- EPS beats continue in at least 3 of the next 4 quarters with positive average surprise above 5%.
CounterRegulated utility earnings are largely set by rate cases rather than operational performance; beat streaks in utilities often simply reflect conservative regulatory assumptions rather than management excellence.
PSEG ranks as an industry growth leader among regulated utilities with a peer rank growth score of 9.0, outperforming on revenue and earnings growth versus its regulated electric utility peer group.
→StablePeer-rank breakdown
- Expectation
- Revenue growth continues above 5% year-over-year and the company maintains its top-quartile peer growth ranking for the next 4 quarters.
CounterGrowth leadership in a rate-regulated business is partially a function of approved capital expenditure programs; growth could stall if regulators deny or delay rate case filings.
Free cash flow is negative at -8% relative to net income, meaning reported earnings exceed actual cash generation, which raises questions about the sustainability of the dividend and ongoing capital expenditure programs.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive within 2 fiscal years as major capital programs wind down and rate base investments begin generating authorized returns.
CounterRegulated utilities with large capital expenditure programs routinely run negative near-term FCF while building rate base that earns authorized returns; negative FCF is often a bullish signal of future earnings growth in this sector.
The stock is priced within 0.7% of analyst targets at $80.15 versus a take-profit of $80.68, providing no meaningful reward-to-risk at current entry levels.
→StableWarnings
- Expectation
- Analyst targets are revised upward above $88 within 12 months as the utility rate base expansion is recognized in updated models.
CounterUtility analyst targets update slowly after rate case decisions; a constructive rate case outcome could prompt simultaneous upgrades from multiple analysts, quickly reopening the upside case.
Per-dimension breakdown
Quality
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.5 |
| ROA | 2.4 |
| Gross margin | 3.1 |
| Op margin | 10.0 |
| Net margin | 8.8 |
| Current ratio | 3.9 |
| FCF quality | 0.0 |
| Moat | 6.1 |
| Piotroski F | 7.8 |
- ▸Strong margins: 18%
- ▸Earnings quality RED FLAG: -8% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
7.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 7.4 |
| EPS growth | 7.1 |
Momentum
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.4 |
| OBV | 10.0 |
| MA position | 4.2 |
| Volume | 2.5 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA but MA still rising (+0.1%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.0 |
| Analyst rating | 7.5 |
| Price target | 6.7 |
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Negligible insider selling — $746,146 (0.002% of mkt cap)
- ▸Institutions accumulating
Peer rank
7.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.2 |
| quality rank | 8.0 |
| growth rank | 9.0 |
- ▸Superior ROE vs peers
- ▸Industry growth leader
Technical
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 6.0 |
| support resistance | 5.6 |
| 52w position | 8.1 |
Risk (lower is worse)
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.7 |
| days to cover | 7.0 |
| volatility | 7.7 |
| put call | 0.0 |
| implied vol | 7.8 |
| max pain risk | 7.0 |
| beta | 9.8 |
| debt equity | 4.2 |
- ▸Elevated put/call: 2.81
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 6.5 |
| dividend safety | 4.7 |
| news activity | 6.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 11 days
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (3)
- INSIDER:OK
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:4.3<4.5
- ASYMMETRY:0.1<1.5@spot
Warning (2)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
- EARNINGS_PROXIMITY:11d<=14d (soft)
Reward-to-Risk
0.07
Upside
+0.3%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 45 mid-range, Bollinger mid-band
EdgeCatalyst-Driven — Earnings in 11d with 4/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: INSIDER:OK. Top dim: Insider at 7.3; weakest: Momentum at 4.3. No conviction either direction.
The strongest dimensions are Insider at 7.3, Growth at 7.2, and Peer rank at 7.0; the weakest are Momentum at 4.3, Quality at 5.2, and Value at 5.7. The V9 engine flagged 2 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 0.07 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak
Trip ifEPS falls below $1.30 per quarter for 2 consecutive quarters, indicating earnings deterioration below the current $1.43-$1.55 range.
- P2Sector Growth Leadership
Trip ifRevenue growth falls below 3% year-over-year for 2 consecutive quarters, indicating loss of growth leadership versus peers.
- P3Negative Fcf Concern
Trip ifFree cash flow remains more than 20% negative relative to net income for 2 consecutive fiscal years without a corresponding rate base increase announcement.
- P4Target Reached Low Asymmetry
Trip ifAnalyst consensus target falls below $75, reducing the projected recovery upside to less than 5% from current levels.