Xcel Energy Inc (NASDAQ: XEL)

Sector: Utilities Industry: Utilities - Regulated Electric CIK: 0000072903
Market Cap 41.10 Bn
P/B 3.74
P/E 37.21
P/S 3.75
ROIC (Qtr) 4.17
Div Yield % 2.37
Rev 1y % (Qtr) 7.44
Total Debt (Qtr) 35.52 Bn
Debt/Equity (Qtr) 1.68
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About

Xcel Energy Inc., commonly known as Xcel Energy, operates in the energy industry, specifically as a major U.S. regulated electric and natural gas delivery company. Headquartered in Minneapolis, Minnesota, the company provides energy services in eight states, namely Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas, and Wisconsin. Xcel Energy's primary business activities encompass the generation, transmission, distribution, and sale of electricity and natural gas. The company owns a diverse energy mix, including coal,...

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Investment thesis

Bull case

  • Operating cash flow of 4.54B provides strong 103.14x coverage of stock compensation 44M, indicating sustainable incentive practices.
  • Free cash flow of (5.15B) provides excellent 4.09x coverage of dividends (1.26B), indicating sustainable shareholder returns.
  • Tangible assets of 79.15B provide robust 23.45x coverage of other current liabilities 3.38B, indicating strong asset backing.
  • Operating cash flow of 4.54B provides solid 0.63x coverage of current liabilities 7.15B, showing strong operational health.
  • Operating cash flow of 4.54B provides strong 6.28x coverage of inventory 723M, indicating efficient inventory management.

Bear case

  • Operating cash flow of 4.54B barely covers its investment activities of (9.72B), with a coverage ratio of -0.47, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 4.54B provides thin coverage of dividend payments of (1.26B) with a -3.61 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • High receivables of 2.01B relative to inventory of 723M (2.78 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (5.15B) provides weak coverage of capital expenditures of 9.69B, with a -0.53 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of 4.54B provides minimal -11.07x coverage of tax expenses of (410M), suggesting potential tax planning inefficiencies or unsustainable tax positions.

Segments Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Utilities - Regulated Electric
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 NEE Nextera Energy Inc 191.44 Bn 28.01 6.98 95.62 Bn
2 SO Southern Co 97.42 Bn 30.98 4.46 73.75 Bn
3 AEP American Electric Power Co Inc 64.38 Bn 33.83 4.24 0.00 Bn
4 DUK Duke Energy CORP 56.47 Bn 30.61 3.87 89.65 Bn
5 EXC Exelon Corp 48.53 Bn 17.53 2.00 50.08 Bn
6 ETR Entergy Corp /De/ 45.74 Bn 25.29 3.59 30.45 Bn
7 PEG Public Service Enterprise Group Inc 43.93 Bn 35.35 4.41 23.51 Bn
8 XEL Xcel Energy Inc 41.10 Bn 37.21 3.75 35.52 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.70 1.01
EV to Cash from Ops. EV/CFO 18.59 12.45
EV to Debt EV to Debt 1.56 171.92
EV to EBIT EV/EBIT 23.78 19.12
EV to EBITDA EV/EBITDA 15.92 15.67
EV to Free Cash Flow [EV/FCF] EV/FCF -77.90 -28.25
EV to Market Cap EV to Market Cap 1.35 1.84
EV to Revenue EV/Rev 5.05 4.72
Price to Book Value [P/B] P/B 3.74 2.60
Price to Earnings [P/E] P/E 37.21 18.53
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.52 1.94
Dividend Payout Ratio % Div Payout % (Qtr) 68.60 62.23
Dividend per Basic Share Div per Share (Qtr) 2.26 2.02
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) -25.95 -218.37
Interest Coverage Int. cover (Qtr) 2.09 2.83
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -43.28 -68.90
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -31.91 73.92
Dividend Growth (1y) % Div 1y % (Qtr) 4.35 4.05
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 15.38 15.47
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -0.68 13.33
EBIT Growth (1y) % EBIT 1y % (Qtr) -1.47 15.81
EBT Growth (1y) % EBT 1y % (Qtr) -13.06 19.29
EPS Growth (1y) % EPS 1y % (Qtr) -2.37 21.26
FCF Growth (1y) % FCF 1y % (Qtr) -184.48 -35.52
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 3.18 11.97
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.18 0.22
Cash Payout Ratio Cash Payout (Qtr) 0.09 0.11
Cash Ratio Cash Ratio (Qtr) 0.15 0.98
Current Ratio Curr Ratio (Qtr) 0.80 2.72
Debt to Equity Ratio Debt/Equity (Qtr) 1.68 1.45
Interest Cover Ratio Int Coverage (Qtr) 2.09 2.83
Times Interest Earned Times Interest Earned (Qtr) 2.09 2.83
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 40.90 37.94
EBIT Margin % EBIT Margin % (Qtr) 20.31 316.94
EBT Margin % EBT Margin % (Qtr) 10.58 14.36
Gross Margin % Gross Margin % (Qtr) 46.30 41.20
Net Profit Margin % Net Margin % (Qtr) 13.50 12.57