Regulated Electric · NYSE
Current Price
$38.66
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on PPL Corporation with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
PPL Corporation, a utility holding company, delivers electricity and natural gas in the United States and the United Kingdom. The company operates through two segments: Kentucky Regulated and Pennsylvania Regulated. It serves approximately 429,000 electric and 333,000 natural gas customers in Louisville and adjacent areas in Kentucky; 538,000 electric customers in central, southeastern, and western Kentucky; and 28,000 electric customers in five counties in southwestern Virginia. The company also provides electric services to approximately 1.4 million customers in Pennsylvania; and generates electricity from coal, gas, hydro, and solar sources in Kentucky; and sells wholesale electricity to two municipalities in Kentucky. PPL Corporation was founded in 1920 and is headquartered in Allentown, Pennsylvania.
ROIC (TTM)
4.1%
ROE (TTM)
8.2%
FCF Yield
-4.82%
Based on trailing twelve-month data, PPL shows a free cash flow per share of N/A and a ROIC of 4.1%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of -4.82% are important context metrics when evaluating PPL's stock valuation relative to peers.
The intrinsic value of PPL depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether PPL is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $38.66. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on PPL Corporation: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Regulated Electric industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting PPL's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For PPL Corporation, this means projecting how much free cash flow the Regulated Electric will produce over the next 5-10 years, then discounting those amounts to today's dollars. PPL's ROIC of 4.1% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For PPL, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
