WEC Energy Group, Inc. (WEC) | Investment Case

1. Company Snapshot

1.a. Company Description

WEC Energy Group, Inc., through its subsidiaries, provides regulated natural gas and electricity, and renewable and nonregulated renewable energy services in the United States.The company operates through six segments: Wisconsin, Illinois, Other States, Electric Transmission, Non-Utility Energy Infrastructure, and Corporate and Other.It generates and distributes electricity from coal, natural gas, oil, hydroelectric, wind, solar, and biomass sources; provides electric transmission services; offers retail natural gas distribution services; transports natural gas; and generates, distributes, and sells steam.

As of December 31, 2021, it operated approximately 35,800 miles of overhead distribution lines and 35,600 miles of underground distribution cables, as well as 440 electric distribution substations and 510,500 line transformers; 50,900 miles of natural gas distribution mains; 1,200 miles of natural gas transmission mains; 2.3 million natural gas lateral services; 500 natural gas distribution and transmission gate stations; and 68.2 billion cubic feet of working gas capacities in underground natural gas storage fields.The company was formerly known as Wisconsin Energy Corporation and changed its name to WEC Energy Group, Inc.in June 2015.

WEC Energy Group, Inc.was incorporated in 1981 and is headquartered in Milwaukee, Wisconsin.

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1.b. Last Insights on WEC

WEC Energy Group's recent performance was driven by strong Q2 earnings, beating estimates with $0.76 per share, up from $0.67 per share a year ago. Residential sales surged, fueling a 16% increase in profit. The company's robust capital investments, data center demand, and $3.02 per share net income for the first six months of 2025 position it for continued revenue and earnings growth. With a 3.3% yield and 21 years of dividend growth, WEC Energy offers predictable earnings and a strong balance sheet, supporting long-term appreciation.

1.c. Company Highlights

Last Price	111.42
Change Percentage	-0.46%
Open	113.07
Previous Close	111.94
Market Cap ( Millions)	36244
Volume	2345295
Year High	118.19
Year Low	99.89
M A 50	107.37
M A 200	108.65

FCF Yield	-2.89%
Dividend Yield	3.20%
ROE	7.77%
Debt / Equity	9.46%
Net Debt / EBIDTA	92.81%
Price To Book	0.9
Price Earnings Ratio	23.26
Price To FCF	-34.66
Price To sales	3.7
EV / EBITDA	9.81

2. WEC Energy Group's Strong 2025 Results and Growth Outlook

WEC Energy Group reported adjusted earnings of $5.27 per share for full-year 2025, beating expectations. The company's utility operations adjusted earnings were $0.63 higher in 2025 compared to 2024, driven by rate-based growth and favorable weather. The earnings per share (EPS) for 2025 were $5.27, an increase of $0.39 per share over 2024 adjusted earnings. Revenue growth was robust, driven by strong economic growth in the region, particularly from large data center projects, including Microsoft's large data center complex.

Publication Date: Feb -06

                                    📋 Highlights
                                    Adjusted Earnings:
                                                Full-year 2025 adjusted earnings were $5.27/share, up $0.39/share from 2024, excluding a 46¢/share one-time Illinois settlement charge.
Capital Plan Expansion:
                                                A $37.5 billion five-year capital plan includes $1 billion for Microsoft’s data center project and 6,500 MW of renewable generation by 2030.
Electric Demand Growth:
                                                Forecasted 3.9 gigawatts of electric demand growth by 2030, driven by Microsoft (500 MW added) and other major industrial investments.
Earnings Growth Outlook:
                                                Long-term EPS growth of 7–8% CAGR (2026–2030), accelerating to the upper half by 2028, supported by rate base expansion and operational efficiency.
Regulatory Resolutions:
                                                Proposed Illinois settlement resolves 12 pending cases, while Wisconsin’s rate review filings for 2027–2028 aim to address affordability and growth funding.

                                

Growth Drivers and Capital Plan

The company is seeing significant growth from large businesses, including Microsoft, Foxconn, Rockwell Automation, and Uline, resulting in an estimated $1 billion of additional incremental capital to the capital plan. WEC Energy Group is projecting 3.9 gigawatts of electric demand growth in its five-year plan, with a focus on executing its updated $37.5 billion capital plan over the next five years. The company expects to invest $7.4 billion in modern, efficient natural gas generation and LNG storage, and $12.6 billion to add 6,500 megawatts of renewable generation.

Regulatory Updates and Outlook

WEC Energy Group has made progress on regulatory matters, including a proposed settlement in Illinois that would resolve all issues related to 12 pending cases. The company is also expecting a commission order in early May for customers to take service under the proposed very large customer tariff in June. For the full year 2026, the company is reaffirming its annual guidance of $5.51 to $5.61 per share, with analysts estimating revenue growth at 6.4%.

Valuation and Metrics

With a P/E Ratio of 23.38, the stock appears to be reasonably valued. The Dividend Yield is 3.19%, providing a relatively stable income stream. The ROE is 7.77%, indicating a decent return on equity. As Xia Liu, CFO, mentioned, "We're projecting weather-normal retail electric sales in Wisconsin to grow 1.6% from 2025 levels," highlighting the company's growth prospects. Overall, WEC Energy Group's strong financial performance, growth outlook, and reasonable valuation make it an attractive investment opportunity.

3. NewsRoom

WEC Energy Beats Q4 Earnings Estimates, to Add More Renewable Assets

Feb -06

Source: zacks.com

WEC Energy Group, Inc. (NYSE:WEC) Given Average Recommendation of “Hold” by Analysts

Feb -06

Source: defenseworld.net

WEC Energy Group Inc (WEC) Q4 2025 Earnings Call Highlights: Robust Growth and Strategic Partnerships Drive Future Prospects

Feb -06

Source: gurufocus.com

WEC Energy Group, Inc. (WEC) Q4 2025 Earnings Call Transcript

Feb -05

Source: seekingalpha.com

WEC Energy Group (WEC) Q4 Earnings and Revenues Top Estimates

Feb -05

Source: zacks.com

Utility WEC Energy tops Q4 profit estimates as electricity, gas sales rise

Feb -05

Source: reuters.com

WEC Energy Group posts 2025 results

Feb -05

Source: prnewswire.com

Envestnet Asset Management Inc. Grows Stock Holdings in WEC Energy Group, Inc. $WEC

Feb -05

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.36%)

6. Segments

Utility Operations - Wisconsin

Expected Growth: 4.4%

WEC Energy Group, Inc. is expected to grow due to increasing demand for electric and natural gas services in Wisconsin, driven by population growth and economic development.

Non-Utility Energy Infrastructure

Expected Growth: 4.5%

Strong demand for natural gas and electricity, driven by population growth and increasing industrial activity, supports WEC Energy Group’s pipeline and power generation growth.

Utility Operations - Illinois

Expected Growth: 4.4%

WEC Energy Group’s growth is driven by increasing demand for electricity, focus on renewable energy, and strategic acquisitions. The company’s long-term plan to invest in infrastructure and technology will support its growth momentum.

Utility Operations - Other States

Expected Growth: 4.4%

WEC Energy Group’s operations outside Wisconsin, Michigan, and Illinois are expected to grow, driven by increasing demand for electricity, particularly in the southeastern states, and the company’s strategic investments in renewable energy and grid modernization.

Reconciling Eliminations

Expected Growth: 5.2%

WEC Energy Group’s elimination of intercompany transactions and balances between subsidiaries will enhance financial transparency, leading to improved operational efficiency and better resource allocation, driving growth.

7. Detailed Products

Electricity

Generation, transmission, and distribution of electricity to residential, commercial, and industrial customers

Natural Gas

Distribution of natural gas to residential, commercial, and industrial customers

Renewable Energy

Generation of electricity from wind, solar, and hydroelectric sources

Energy Efficiency

Offering energy-saving solutions and programs to reduce energy consumption

Transmission and Distribution

Operating and maintaining the infrastructure for transmitting and distributing electricity and natural gas

8. WEC Energy Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

WEC Energy Group, Inc. operates in a regulated industry, which limits the threat of substitutes. However, the increasing adoption of renewable energy sources and energy storage technologies could pose a moderate threat to the company's traditional business model.

Bargaining Power Of Customers

WEC Energy Group, Inc. serves a diverse customer base, including residential, commercial, and industrial customers. The company's large customer base and lack of concentration reduce the bargaining power of individual customers.

Bargaining Power Of Suppliers

WEC Energy Group, Inc. relies on a diverse range of suppliers for fuel, equipment, and services. While the company has some bargaining power due to its scale, suppliers may still exert some pressure on prices and terms.

Threat Of New Entrants

The energy industry is highly regulated, and new entrants face significant barriers to entry, including high capital costs, complex regulatory requirements, and the need for specialized expertise.

Intensity Of Rivalry

WEC Energy Group, Inc. operates in a highly competitive industry, with several large players vying for market share. The company faces intense competition in terms of pricing, customer service, and innovation.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	61.53%
Debt Cost	4.46%
Equity Weight	38.47%
Equity Cost	5.92%
WACC	5.02%
Leverage	159.92%

11. Quality Control: WEC Energy Group, Inc. passed 4 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Inefficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Exelon

A-Score: 6.7/10

Value: 6.7

Growth: 3.8

Quality: 4.4

Yield: 7.0

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

WEC Energy

A-Score: 6.7/10

Value: 5.3

Growth: 4.8

Quality: 4.9

Yield: 7.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

Dominion Energy

A-Score: 6.5/10

Value: 5.8

Growth: 3.6

Quality: 5.0

Yield: 8.0

Momentum: 7.0

Volatility: 9.7

1-Year Total Return ->

DTE Energy

A-Score: 6.2/10

Value: 4.8

Growth: 3.7

Quality: 4.1

Yield: 7.0

Momentum: 7.5

Volatility: 10.0

1-Year Total Return ->

NextEra Energy

A-Score: 6.1/10

Value: 2.5

Growth: 5.9

Quality: 5.5

Yield: 6.0

Momentum: 8.0

Volatility: 8.7

1-Year Total Return ->

Xcel Energy

A-Score: 6.0/10

Value: 4.3

Growth: 4.6

Quality: 3.2

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

25.81%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.02%

WEC Energy Group, Inc. - US92939U1060

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on WEC

1.c. Company Highlights

Expensive

Medium Volatility

Average Quality

Earnings Beats

Revenues Miss

Stable Momentum

Earnings Miss

Better Quality

Fairly Valued

Strong Momentum

Revenues Beats

2. WEC Energy Group's Strong 2025 Results and Growth Outlook

Growth Drivers and Capital Plan

Regulatory Updates and Outlook

Valuation and Metrics

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.36%)

6. Segments

Utility Operations - Wisconsin

Expected Growth: 4.4%

Non-Utility Energy Infrastructure

Expected Growth: 4.5%

Utility Operations - Illinois

Expected Growth: 4.4%

Utility Operations - Other States

Expected Growth: 4.4%

Reconciling Eliminations

Expected Growth: 5.2%

7. Detailed Products

Electricity

Natural Gas

Renewable Energy

Energy Efficiency

Transmission and Distribution

8. WEC Energy Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: WEC Energy Group, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

111.42$

Current Price

111.42$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA