Public Service Enterprise Group Incorporated (PEG) Stock Valuation — PE Analysis
Regulated Electric · NYSE
Current Price
$77.75
PE Ratio (TTM)
17.1x
Intrinsic Value
$89.62
+13.2% margin of safety
COMPETITIVE MOAT
↑Regulated Monopoly Infrastructure
PEG operates as a regulated utility, granting it exclusive rights to provide electricity and gas services within its service territories. This creates a natural monopoly, limiting direct competition.
↑High Capital Intensity
The significant investment required to build and maintain electric and gas infrastructure creates a substantial barrier to entry for potential competitors. This capital intensity deters new entrants.
↑Essential Service Demand
Electricity and gas are fundamental necessities for households and businesses. This inherent demand provides a stable and predictable revenue stream, even during economic downturns.
INVESTMENT RISKS
↓Extreme Weather Events
Increasingly severe weather events, such as heatwaves, can strain infrastructure and lead to higher operational costs for repairs and maintenance, impacting service reliability.
↓Technological Disruption
While infrastructure is a moat, the long-term transition to renewable energy sources and distributed generation could eventually challenge traditional utility models if not managed proactively.
↓Interest Rate Sensitivity
Utilities are capital-intensive businesses that often carry significant debt. Rising interest rates can increase financing costs, impacting earnings and the attractiveness of dividend payouts.
Base case
PEG base case PE valuation
A base case PE valuation for PEG estimates a fair value of about $89.62 per share, against a current price of $77.75. The model assumes 7.4% annual earnings growth, a 17x target PE multiple, and a 10% discount rate.
Intrinsic Value
$89.62
Margin of safety
+13.2%
Expected annual return
+2.9%
Base case assumptions: 7.4% annual earnings growth, 17x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the PEG PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Public Service Enterprise Group Incorporated respond.
Open PE Calculator for PEGCompany Overview
Public Service Enterprise Group Incorporated (PSEG) is an energy provider primarily operating through its subsidiaries in the Northeastern and Mid-Atlantic United States. The company's business activities are structured into two primary segments: PSE&G and PSEG Power. The PSE&G division is responsible for transmitting electricity and distributing both electricity and natural gas to residential, commercial, and industrial customers. This segment also commits resources to solar power generation projects and various energy efficiency initiatives, as well as offering appliance service and repair. By December 31, 2021, its substantial infrastructure included 25,000 circuit miles of electric transmission and distribution systems, supported by 862,000 utility poles. It also featured 56 switching stations with a total capacity of 39,353 megavolt-amperes (MVA) and 235 substations with a combined capacity of 9,285 MVA. The electric network was further managed by four main and five sub-electric distribution headquarters. On the gas side, PSE&G maintained 18,000 miles of gas mains, twelve primary and two secondary gas distribution headquarters, a single meter shop, and 58 natural gas metering and regulating stations. Public Service Enterprise Group Incorporated was established in 1985 and is headquartered in Newark, New Jersey.
Financial Metrics — PEG PE Stock Valuation Data
PE Ratio (TTM)
17.1x
PEG Ratio
0.71
Earnings Yield
5.83%
ROE (TTM)
13.3%
Revenue/Share (TTM)
$25.64
Dividend Yield
3.34%
Debt/Equity
0.97x
Frequently Asked Questions
What is the PE ratio of PEG?
The trailing twelve-month PE ratio of PEG reflects how much investors pay per dollar of Public Service Enterprise Group Incorporated's earnings. This metric is most useful when compared to Regulated Electric peers and the company's own historical range.
Is PEG overvalued based on PE ratio?
PEG's PE of 17.1x combined with a PEG ratio of 0.71 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Regulated Electric, a DCF analysis may be more appropriate.
How do I value PEG stock using PE ratio?
To value Public Service Enterprise Group Incorporated using PE: (1) Compare the current PE (17.1x) against the Regulated Electric median to assess relative pricing, (2) check the PEG ratio (0.71) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of PEG?
PEG's PEG ratio is 0.71, calculated by dividing the PE ratio (17.1x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for PEG stock valuation?
PE ratio gives a quick relative read — how PEG is priced versus Regulated Electric peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See PEG DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Utilities valuationsP/E and DCF value PEG with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.