- 2025 Financial Performance: Achieved ongoing earnings of $1.81 per share (+7.1% YoY) and $4.4B in capital investments focused on grid modernization and advanced metering.
- 2026 Earnings Guidance: Set a range of $1.90–$1.98/share (7.2% growth from 2025) with a $23B investment plan (2026–2029) targeting 10.3% annual rate base CAGR.
- Operational Efficiency: Delivered $170M in O&M savings (exceeding $20M target) and reduced O&M costs by 3% annually, supporting affordability and EPS growth.
- Data Center Pipeline: Pennsylvania’s pipeline reached 25.2 GW (+23% QoQ) and Kentucky’s at 9 GW, driven by electrification and economic development partnerships (e.g., Eli Lilly’s $3.5B investment).
- Strategic Partnerships: Launched a Blackstone joint venture to build new generation in PJM, targeting $1.3B for Pennsylvania data center reliability projects and potential backstop generation solutions by 2028–2029.
Operational Highlights
Operationally, PPL performed well, with high levels of reliability and execution. The company focused on innovation and digital solutions to improve customer service, including an AI-powered digital customer service agent and a customer app. PPL achieved $170 million in run-rate savings by 2025, exceeding its O&M savings target. The company's commitment to affordability remains a core element of its strategy, with a focus on cost control and economic development to support customer affordability.
Guidance and Outlook
PPL issued ongoing earnings guidance of $1.90 to $1.98 per share for 2026, with a midpoint of $1.94, representing a 7.2% increase from 2025. The company extended its 6% to 8% annual EPS growth target through 2029, with a projected EPS CAGR near the top end of that range. PPL's updated capital investment plan includes $23 billion in investments from 2026 to 2029, with a 10.3% rate base CAGR, providing a strong foundation for predictable and durable earnings growth.
Valuation Metrics
Using the current valuation metrics, PPL's P/E Ratio is 23.46, indicating that the stock may be slightly overvalued. The P/B Ratio is 1.28, suggesting that the stock is reasonably priced. The EV/EBITDA ratio is 13.85, which is relatively moderate. The Dividend Yield is 2.91%, providing a relatively stable source of return. As Vince Sorgi mentioned, "We're thinking about keeping up with the ramp rates by getting smaller generation amounts online quicker," which may contribute to the company's growth prospects.
Growth Prospects
PPL's growth prospects are driven by its updated business plan, which extends its growth trajectory and strengthens the predictability of its earnings. The company's focus on data center development, electrification, and new generation is expected to drive growth. The data center backlog of 10 gigawatts by the end of the decade is significant, and PPL is engaging with hyperscalers to provide solutions. The joint venture with Blackstone is also expected to contribute to the company's growth prospects, although the earnings contribution is not assumed in the updated plan.