Entergy Corporation (ETR) Stock Valuation — DCF Analysis
Regulated Electric · NYSE
Current Price
$111.11
Intrinsic Value
Use the calculator below to estimate
COMPETITIVE MOAT
↑Regulated Monopoly Power
Entergy operates as a regulated utility, granting it exclusive rights to serve specific geographic areas. This regulatory structure creates a natural monopoly, limiting direct competition.
↑Essential Service Infrastructure
The company owns and maintains critical electricity generation and distribution infrastructure. Replacing this extensive network would be prohibitively expensive and time-consuming for any competitor.
↑Long-Term Customer Relationships
As a provider of an essential service, Entergy has established long-standing relationships with its customer base. Switching costs for customers are high, fostering customer stickiness.
INVESTMENT RISKS
↓Regulatory Uncertainty
Changes in state and federal regulations can impact Entergy's pricing, operational costs, and investment plans. Adverse regulatory decisions could significantly affect profitability.
↓Capital Intensity and Debt
The utility sector requires substantial capital investment for infrastructure maintenance and upgrades. High debt levels can increase financial risk, especially during periods of rising interest rates.
↓Environmental and Climate Risks
Entergy faces risks associated with extreme weather events and the transition to cleaner energy sources. Investments in grid resilience and renewable energy are necessary but costly.
Customize the ETR valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Entergy Corporation respond.
Open DCF Calculator for ETRCompany Overview
Entergy Corporation, headquartered in New Orleans, Louisiana, is a prominent American energy company primarily involved in generating and distributing electricity across the United States. Its operations are divided into two main divisions: Utility and Entergy Wholesale Commodities. The Utility division manages the end-to-end process of generating, transmitting, distributing, and selling electricity. This service covers specific regions of Arkansas, Louisiana, Mississippi, and Texas, including the metropolitan area of New Orleans, providing electricity to 3 million utility customers in these states. Additionally, this segment handles natural gas distribution. In contrast, the Entergy Wholesale Commodities division focuses on the ownership, operation, and decommissioning of nuclear power facilities. It also holds stakes in various non-nuclear power plants, selling their output to wholesale clients, and offers specialized services to other nuclear power plant operators. Entergy's electricity generation portfolio is diverse, utilizing natural gas, nuclear, coal, hydroelectric, and solar power. Collectively, its power plants boast an approximate generating capacity of 26,000 megawatts (MW), with 6,000 MW specifically from nuclear sources. Beyond its direct utility customers, Entergy also supplies energy to a range of wholesale clients, including other retail power providers, utility companies, electric power cooperatives, energy trading organizations, and fellow power generation firms. The company has a long history, established in 1913.
Financial Metrics — ETR Stock Valuation Data
Revenue/Share (TTM)
$29.16
FCF/Share (TTM)
$-6.58
ROIC (TTM)
3.3%
ROE (TTM)
10.6%
P/FCF
n/m
EV/EBITDA
13.8x
FCF Yield
-5.90%
Debt/Equity
1.96x
ETR currently has negative free cash flow, so cash-flow ratios such as P/FCF and FCF yield do not give a meaningful read on whether the stock is cheap or expensive. A DCF valuation is unreliable until cash generation turns positive — focus on the path to profitability instead.
Frequently Asked Questions
What is the intrinsic value of ETR?
Entergy Corporation currently generates $-6.58 in free cash flow per share. At the current price of $111.11, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is ETR undervalued?
ETR currently has negative free cash flow, so its P/FCF ratio is not meaningful and cannot tell you whether the stock is cheap or expensive. With cash flow negative, a DCF-based undervalued or overvalued judgment is unreliable — look at the path back to positive cash generation instead.
How do I value ETR stock using DCF?
To perform a DCF valuation on Entergy Corporation: (1) Start with the trailing free cash flow per share ($-6.58) 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 ETR's risk profile — with a debt-to-equity of 1.96x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to ETR?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Entergy Corporation, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Regulated Electric trends, then discounting those amounts to today's dollars. ETR's ROIC of 3.3% suggests the company may face challenges generating returns above its cost of capital.
How does WACC affect ETR stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For ETR, with a debt-to-equity ratio of 1.96x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 13.8x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See ETR PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Utilities valuationsDCF and P/E value ETR with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.