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US Equities · Finance research note

EXC — Exelon

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2. Company Fundamentals

2.1 Competitiveness

Metric Value
Operating Margins 22.3%
Profit Margins 11.21%
Return on Equity 9.76%
Return on Assets 2.84%
Free Float 1.02B
Dividend Yield 3.54%
Short Int % Utilisation 4.63%

2.2 Growth

Metric Value
Revenue Growth 7.9%
Free Cash Flow -2.81B
EBITDA 11.78 (Ratio)
Enterprise Value 97.2B
EV/Revenue 3.92
EV/EBITDA 11.78

Revenue growth of 7.9% indicates steady, moderate expansion.

2.3 Management

Role Metric
Consensus Rating N/A

2.4 Return

Metric Value
Expected Return (Ann.)* 7.63%
Risk / Std Dev (Ann.)* 19.16%
1-Year Price Return* 5.64%

Latest Market Data (as of 2026-08-14, US Eastern time):

Metric Value
Last Price $45.86
52-Week Range $42.58 – $50.65
Observation Count 251 trading days

The return and risk statistics use daily adjusted closes from the retrieved one-year series and annualise daily moments using 252 trading days. The last price is the latest regular-market price reported for the stated date. Source: Yahoo Finance market data.

DuPont Model Analysis

The DuPont model decomposes return on equity (ROE) into three operating and capital-structure drivers:

ROE = Net Margin × Asset Turnover × Equity Multiplier

The comparison uses the latest two comparable annual periods available for the issuer, with reported statement amounts shown in US$. Revenue and net income are income-statement flows; total assets and shareholders’ equity are year-end balance-sheet figures. This is a simplified year-end-balance DuPont comparison rather than an average-balance ROE calculation.

DuPont component Calculation FY2025 FY2024
Revenue Reported revenue $24.26B $23.03B
Net income Reported net income $2.77B $2.46B
Total assets Year-end reported balance $116.57B $107.78B
Shareholders’ equity Year-end reported balance $28.80B $26.92B
Net margin Net income ÷ revenue 11.41% 10.68%
Asset turnover Revenue ÷ total assets 0.2081x 0.2136x
Equity multiplier Total assets ÷ shareholders’ equity 4.0479x 4.0037x
ROE Net margin × asset turnover × equity multiplier 9.61% 9.14%

Source: Yahoo Finance annual statements. Values are based on the two latest comparable annual periods returned by the source; fiscal period labels use the statement period-end year.

2.5 FCFF DCF Valuation

Valuation basis: This research model follows a five-year, unlevered FCFF DCF. It starts from reported annual operating inputs, forecasts revenue and operating cash conversion under an explicit mechanical policy, discounts FCFF at WACC, applies a Gordon-growth terminal value, and bridges enterprise value to an indicative common-equity value per share. It is an analytical estimate rather than a recommendation or personalised target price.

Step 1 — Forecast Operating Profit and NOPAT

Reported operating input Value
Revenue $24.26B
Prior annual revenue $23.03B
EBIT $5.42B
Tax rate 15.90%
NOPAT = EBIT × (1 − tax rate) $4.56B
Forecast start-growth basis 5.34%
Forecast policy latest reported annual revenue growth, bounded to -10.00% / 15.00%

Step 2 — Calculate FCFF

Current FCFF building block Value
NOPAT $4.56B
Add: depreciation & amortisation $3.05B
Less: capital expenditure -$8.53B
Less/(add): working-capital cash-flow movement -$1.52B
Current unlevered FCFF -$2.45B

Explicit FCFF forecast

Forecast year Revenue growth NOPAT D&A Capex Change in NWC FCFF Present value
1 5.34% $4.80B $3.21B -$8.98B -$1.61B -$2.58B -$2.52B
2 4.63% $5.02B $3.36B -$7.89B -$1.68B -$1.19B -$1.10B
3 3.92% $5.22B $3.49B -$6.63B -$1.75B $333.36M $293.33M
4 3.21% $5.39B $3.60B -$5.22B -$1.80B $1.96B $1.64B
5 2.50% $5.52B $3.69B -$3.69B -$1.85B $3.67B $2.92B

Step 3 — Determine the Discount Rate (WACC)

WACC input Value
Risk-free rate 4.71%
Equity risk premium assumption 5.50%
Beta 0.40
Cost of equity 6.89%
Pre-tax cost of debt 4.40%
WACC 5.25%
WACC validation requires assumption review

Step 4 — Estimate Terminal Value

Terminal-value input Value
Perpetuity growth rate 2.50%
Terminal value $136.99B
Implied terminal EV / EBITDA 13.36x
Terminal value as % of enterprise value 98.85%

Step 5 — Discount Cash Flows to Enterprise Value

Enterprise-value component Value
Present value of explicit FCFF $1.24B
Present value of terminal value $106.07B
Indicated enterprise value $107.31B
Discounting convention mid-year for explicit FCFF; terminal value discounted at year-end five

Step 6 — Convert Enterprise Value to Equity Value

Equity bridge Value
Indicated enterprise value $107.31B
Less: gross interest-bearing debt $50.08B
Add: cash and equivalents $626.00M
Add: affiliate investments $0.00
Less: minority interests $0.00
Indicated common equity value $57.85B

Step 7 — Calculate Indicative Value Per Share

Per-share output Value
Shares used 1,012,000,000.00
Share-count basis reported diluted weighted-average shares
Current market price $45.95
DCF indicative value per share $57.17
Indicative value vs. market price 24.41%

Model Integrity Checks

Check Result
Perpetuity growth is below the risk-free rate pass
Perpetuity growth is below WACC pass
WACC is within the configured operating-company range review required
Terminal-year FCFF is positive pass
Terminal capex converges to D&A pass
Terminal-value concentration review required
Implied price differs from spot by more than 30% within review band

2.6 Investor-Style Research Screen

Educational screen Result
Buffett-inspired cash-quality checks 0/4 evidenced checks
Lynch-inspired balance-and-growth checks 1/4 evidenced checks

Data lineage: Yahoo Finance public market and reported-statement data; retrieval timestamp: 2026-08-18 17:32:43.304514 UTC; latest reported fiscal period: 2025-12-31 00:00:00. Default assumptions: five-year forecast, mid-year discounting for explicit FCFF, a maximum 2.50% perpetuity-growth rate below both WACC and the risk-free rate, historical operating-ratio persistence, and capex convergence to D&A by year five. No sell-side consensus or management guidance is substituted for reported inputs. This is research and analysis only, not personalized financial advice.

2.7 Quantitative Factor Diagnostics

Model basis: Daily issuer USD excess returns are regressed in-sample using ordinary least squares on matching regional Fama–French factors. FF3 estimates market, size, and value loadings; FF5 adds profitability and investment. Coefficients are descriptive historical exposures, not predictions.

Estimation input Value
Regional factor set US
Factor-return currency USD
Issuer-return basis USD adjusted total return
Estimation window 2025-08-19 to 2026-06-30
Aligned daily observations 217
Minimum observation requirement 120
Currency conversion for HK listings not required

Fama–French Three-Factor and Five-Factor Results

Diagnostic FF3 FF5
Annualised alpha 4.54% 8.05%
Adjusted R² 0.04 0.03
Annualised residual volatility 18.22% 18.16%
Factor loading (t-statistic) FF3 FF5
Market excess return (Mkt-RF) -0.15 (-1.39) -0.08 (-0.67)
Size (SMB) 0.10 (0.66) 0.12 (0.79)
Value (HML) 0.24 (1.93) 0.20 (1.32)
Profitability (RMW) NM 0.15 (1.13)
Investment (CMA) NM 0.01 (0.07)

Definitions: Mkt-RF is the market return less the risk-free rate; SMB is small minus big; HML is high minus low book-to-market; RMW is robust minus weak profitability; CMA is conservative minus aggressive investment. Factor returns are sourced from the Kenneth R. French Data Library; issuer adjusted-return history is sourced from Yahoo Finance. For Hong Kong listings, adjusted HKD prices are converted into USD with daily USD/HKD closes before return calculation to match the USD regional factor basis. This is an in-sample historical regression; coefficients and t-statistics do not establish causation or predict future returns. This is research and analysis only, not personalized financial advice.

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