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1. Company Snapshot

1.a. Company Description

Xcel Energy Inc., through its subsidiaries, generates, purchases, transmits, distributes, and sells electricity.It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments.The company generates electricity through coal, nuclear, natural gas, hydroelectric, solar, biomass, oil, wood/refuse, and wind energy sources.


It also purchases, transports, distributes, and sells natural gas to retail customers, as well as transports customer-owned natural gas.In addition, the company develops and leases natural gas pipelines, and storage and compression facilities; and invests in rental housing projects, as well as procures equipment for the construction of renewable generation facilities.It serves residential, commercial, and industrial customers in the portions of Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas, and Wisconsin.


The company sells electricity to approximately 3.7 million customers; and natural gas to approximately 2.1 million customers.Xcel Energy Inc.was incorporated in 1909 and is headquartered in Minneapolis, Minnesota.

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1.b. Last Insights on XEL

Xcel Energy's recent performance is driven by strategic investments and customer growth. The company has invested $45 billion to boost reliability and clean power, benefiting from rising demand and data center growth. Its Q2 earnings beat estimates, with a quarterly earnings of $0.75 per share, driven by increased recovery of infrastructure investments. Additionally, Xcel Energy has reached agreements to resolve all litigation related to the 2021 Marshall Fire, reducing legal risks. The company's strong infrastructure recovery and customer growth position it to capitalize on AI-driven data center demand, supporting 8% EPS growth.

1.c. Company Highlights

2. Xcel Energy's 2025 Earnings: A Strong Performance

Xcel Energy reported ongoing earnings of $3.80 per share for 2025, marking the 21st consecutive year of meeting or exceeding initial ongoing earnings guidance. The company's financial performance was driven by higher electric and natural gas revenues due to rate case outcomes, nonfuel riders, and sales growth, partially offset by higher fuel and purchased power expenses. Revenue growth is expected to continue, with analysts estimating a 7.9% increase next year. The actual EPS for the quarter came out at $0.96, slightly below estimates of $0.962.

Publication Date: Feb -06

📋 Highlights
  • 2025 Earnings Growth:: Xcel Energy reported ongoing earnings of $3.80 per share in 2025, up from $3.50 in 2024, marking 21 consecutive years of meeting or exceeding guidance.
  • Capital Investment:: The company invested $12 billion in 2025, including a coal-to-natural gas plant conversion and 370 MW of wind repowerings, the largest one-year total in its history.
  • Data Center Expansion:: Xcel aims to contract 3 GW of data center capacity by 2026 and 6 GW by 2027, doubling its target to drive future sales growth in the 2030s.
  • Reaffirmed 2026 Guidance:: EPS guidance remains $4.04–$4.16 per share, with long-term targets of 6–8% earnings growth and 9% EPS growth through 2030.
  • Regulatory & Infrastructure Pipeline:: The company has a $10 billion capital pipeline, including 10–12+ GW of generation/transmission opportunities in SPP and MISO, and a 765 kV transmission project awarded in SPP.

Financial Highlights

The company's financial results were characterized by a strong EPS performance, with ongoing earnings per share increasing to $3.80 in 2025 from $3.50 in 2024. Xcel Energy's capital plan is expected to drive future growth, with a significant investment of nearly $12 billion in 2025. The company's return on equity (ROE) stands at 13.03%, indicating a relatively healthy profitability level.

Valuation Metrics

Xcel Energy's current valuation metrics suggest a reasonable pricing level. The stock's P/E Ratio is 22.44, while the P/S Ratio is 3.07. Additionally, the EV/EBITDA ratio is 18.5, indicating that the company's enterprise value is roughly 18.5 times its EBITDA. The Dividend Yield is 3.0%, providing a relatively stable income stream for investors.

Data Center Opportunities

Xcel Energy has made significant progress in its data center business, with over two gigawatts of signed ESAs and a target of contracting six gigawatts of total data center capacity by 2027. The company expects to have the contracts signed by 2027, with the construction cycle and energization occurring in the late 2020s and early 2030s. This is expected to drive significant sales growth in future years, particularly in the 2030s.

Regulatory Updates

The company is working on various regulatory filings, including a large load tariff filing in Colorado, which is expected to be filed in Q2. Xcel Energy is also updating its resource plans to reflect the incremental load growth and capital needs associated with the data center opportunities. The company's commitment to transparency and regulatory compliance is evident in its efforts to provide updates to investors.

Growth Prospects

Xcel Energy's growth prospects appear promising, driven by its data center business and investment opportunities. The company's $10 billion pipeline of additional investments is expected to drive future growth, with a focus on the Upper Midwest region. As the company continues to execute on its capital plan, investors can expect a steady stream of updates on its progress.

3. NewsRoom

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Xcel Energy Inc (XEL) Q4 2025 Earnings Call Highlights: Strong Earnings Amid Strategic Investments and Challenges

Feb -05

Source: gurufocus.com

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Xcel Energy Inc. (XEL) Q4 2025 Earnings Call Transcript

Feb -05

Source: seekingalpha.com

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Xcel Energy Q4 Earnings and Revenues Lag Estimates, Expenses Rise

Feb -05

Source: zacks.com

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Xcel (XEL) Reports Q4 Earnings: What Key Metrics Have to Say

Feb -05

Source: zacks.com

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Xcel Energy (XEL) Misses Q4 Earnings and Revenue Estimates

Feb -05

Source: zacks.com

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Xcel Energy's quarterly profit rises on AI-driven power demand

Feb -05

Source: reuters.com

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Xcel Energy 2025 Year End Earnings Report

Feb -05

Source: businesswire.com

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Xcel Energy and NextEra Energy Agree to Deliver Generation Solutions and Enable Large Load Across Xcel Energy's Service Territories

Feb -04

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.46%)

6. Segments

Regulated Electric Utility

Expected Growth: 4.5%

Xcel Energy's growth is driven by increasing demand for electricity in Minnesota and Colorado, supported by the region's growing economy and population, as well as the company's investments in renewable energy and grid modernization.

Regulated Natural Gas Utility

Expected Growth: 4.3%

Growing demand for natural gas and increasing investment in infrastructure development are expected to drive the segment's growth, supported by Xcel Energy Inc.'s focus on expanding its natural gas distribution and transportation services.

Non Segment Revenues

Expected Growth: 4.2%

Xcel Energy’s non-regulated revenue growth is driven by increasing demand for renewable energy solutions, expansion of its energy storage business, and investments in grid modernization, leading to a forecast CAGR of 4.2%.

Eliminate Intersegment Revenue

Expected Growth: 5.6%

Xcel Energy's growth is driven by increasing demand for renewable energy, investments in grid modernization, and strategic acquisitions, positioning the company for long-term growth and profitability.

7. Detailed Products

Electricity

Xcel Energy provides electricity to residential, commercial, and industrial customers through its regulated utility operations.

Natural Gas

Xcel Energy delivers natural gas to customers through its regulated utility operations, providing a clean and efficient source of energy.

Renewable Energy

Xcel Energy offers renewable energy solutions, including wind and solar power, to customers seeking sustainable energy options.

Energy Efficiency

Xcel Energy provides energy-efficient solutions and programs to help customers reduce energy consumption and lower their energy bills.

Smart Grid

Xcel Energy's smart grid technology enables real-time energy monitoring, efficient energy distribution, and improved outage response.

Energy Storage

Xcel Energy offers energy storage solutions, including battery storage, to help customers manage energy usage and reduce peak demand.

8. Xcel Energy Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Xcel Energy 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

Xcel Energy Inc. serves a diverse customer base, including residential, commercial, and industrial customers. While large industrial customers may have some bargaining power, the company's overall customer base is fragmented, limiting their bargaining power.

Bargaining Power Of Suppliers

Xcel Energy Inc. relies on a diverse range of suppliers for fuel, equipment, and services. While some suppliers may have bargaining power, the company's scale and diversification of suppliers mitigate this risk.

Threat Of New Entrants

The energy industry is highly regulated, and significant barriers to entry exist, including high capital requirements and complex regulatory frameworks. This limits the threat of new entrants to Xcel Energy Inc.'s business.

Intensity Of Rivalry

Xcel Energy Inc. operates in a competitive industry, with several large players vying for market share. However, the company's strong brand, diversified customer base, and operational efficiency help to mitigate the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 59.84%
Debt Cost 3.95%
Equity Weight 40.16%
Equity Cost 5.76%
WACC 4.68%
Leverage 149.01%

11. Quality Control: Xcel Energy Inc. passed 3 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

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A-Score: 6.0/10

Value: 4.3

Growth: 4.6

Quality: 3.2

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

75.9$

Current Price

75.9$

Potential

-0.00%

Expected Cash-Flows