Updated 3/13/25
Public Service Enterprise Group, or PEG, might not be a household name outside the energy space, but for income-focused investors, it’s long been a quiet force in the utilities sector. Based in New Jersey, PEG’s main operations run through PSE&G, one of the nation’s largest regulated utility companies. While it doesn’t grab headlines like tech stocks or flash massive earnings growth, PEG’s value lies in its dependability—and for dividend investors, that’s often more important.
This is a company that has weathered decades of economic ups and downs with its steady hand, offering consistent payouts while gradually expanding its infrastructure and renewable energy footprint.
Recent Events
PEG has had a few bumps over the past year, including some softer revenue and earnings numbers in its most recent quarterly report. Quarterly earnings growth dropped sharply, down about 48% year-over-year, and revenue took a modest 5% dip. Some of this can be chalked up to cyclical seasonal demand and regulatory rate timing. It’s not ideal, but it’s not a structural problem either.
In the background, PEG continues to plow capital into long-term projects. That includes transmission upgrades, grid modernization, and more investment into clean energy. These are big spends, and they’re pulling down free cash flow in the short run. At the same time, management hasn’t flinched on the dividend, which says a lot about how confident they are in the long-term strategy.
Key Dividend Metrics
📈 Forward Yield: 3.02%
💵 Annual Dividend: $2.52 per share
🛡 Payout Ratio: 67.8%
📅 Next Dividend Date: March 31, 2025
📊 5-Year Average Yield: 3.36%
⚖️ Dividend Growth Rate: Low but consistent
🔁 Payment Schedule: Quarterly
🔓 Dividend Outlook: Stable with cautious growth
Dividend Overview
PEG’s yield sits just over 3% right now, which is solid though a bit under its longer-term average. The dividend itself, at $2.52 per share annually, reflects small but steady growth year after year. For investors used to sharp dividend hikes, PEG may feel a little slow. But for those who prioritize consistency over surprises, it’s a dependable source of quarterly income.
The company isn’t trying to stretch itself with aggressive payouts. Instead, it’s keeping the dividend in a range that allows room for reinvestment and the kind of flexibility that matters in a capital-heavy industry.
Dividend Growth and Safety
Let’s be real—PEG isn’t going to win awards for its dividend growth. Increases tend to be modest, in the low single digits, and are clearly designed more for stability than for flash. But what makes that appealing is the predictability. PEG has raised its dividend every year for the past decade, even when growth was tepid and cash flow was tight.
The payout ratio currently sits just under 68%. That’s on the high side, but it’s not unusual for a utility with consistent earnings. And while free cash flow is in the red right now, management is playing the long game. They’re betting on infrastructure investments that will stabilize and even grow cash flow in the coming years.
The bottom line is this: the dividend looks sustainable, even with the short-term pressure from spending. As long as earnings stay on track, investors can likely expect the dividend train to keep rolling.
Chart Analysis
Current Market Cycle Stage
Looking at the full chart for PEG, the price action clearly shows a transition that began in late October through early December, where the stock hit its peak just above $95. Since then, price has been steadily declining and has now slipped below both the 50-day and 200-day simple moving averages. This crossover suggests we’re likely in the markdown phase of the Wyckoff cycle.
Prior to this, from April through November, PEG was in a healthy markup phase, making higher highs and riding well above both moving averages. Volume was steady, occasionally spiking on upward pushes, reflecting institutional accumulation during the advance. That trend lost momentum into December, where the stock began to stall and chop sideways. Distribution was likely underway during this period—volume began to pick up on red candles, and price failed to make new highs despite repeated attempts.
The breakdown below the 200-day moving average in late February to early March, coupled with an uptick in volume on the decline, confirms markdown is active. Buyers have started to back off, and we’re now seeing lower lows and weaker support levels forming.
Volume Profile and Pressure Points
Volume spikes in recent sessions have occurred primarily on red days. These elevated red bars signal increasing selling pressure. Buyers are not stepping in aggressively, and demand appears weak. The volume structure in late February shows distribution turning into clear selling. This kind of action usually suggests that the prior holders who were distributing are no longer defending support.
There is some volume support forming near the $78–$80 zone, but it’s not convincing yet. We’d need to see a high-volume reversal day or two with long lower wicks and green closes to indicate a shift in sentiment. That hasn’t happened yet.
RSI Behavior and Momentum
The RSI line has been sitting in a downward channel since the beginning of the year. It dipped below the 30 line in early March and is now hovering in the low 40s. This indicates the stock was recently oversold and is trying to recover, but there isn’t strong momentum behind the move. In earlier months, during the markup phase, RSI consistently stayed in the 60–70 range, which signaled strength. That’s completely faded now.
The failure to return above the midpoint (50) after the oversold bounce shows the lack of bullish conviction. Unless RSI can decisively move higher and break into that 60–70 range again, the selling pressure remains dominant.
Moving Averages: 50-day and 200-day
One of the most telling signs here is the technical behavior of the 50-day simple moving average. It’s now sloping down and recently crossed below the 200-day—this is the classic death cross. While not a timing signal on its own, it aligns with broader trend weakness and signals a longer-term shift in sentiment.
The 200-day moving average, which had been trending upward since early summer, is beginning to flatten. If this starts to curl downward, it’ll confirm PEG has transitioned out of its prior bullish cycle and may remain under pressure for a while.
Candle Structure: Recent Five Sessions
Looking at the latest five candles:
- The most recent candle closed at 79.57 after dipping to a low of 78.43. That lower wick shows some buyers stepping in, but the close remains weak relative to the high.
- One day earlier, we saw a green candle with a small body and upper wick—buying was present, but it wasn’t confident. Sellers pushed back.
- The session before that was a classic doji with tight range and indecision, often signaling a possible reversal attempt—but it didn’t hold.
- The first two candles in this group were both red with long bodies, showing firm downward movement and volume behind the selloff.
This five-day stretch reflects hesitation. There’s no aggressive buying, but sellers are no longer slamming the price downward as forcefully. It’s a pause—possibly the beginning of a short-term consolidation—but it doesn’t yet look like accumulation. We’d need to see tighter ranges, lower volume, and basing behavior to confirm that.
Overall, PEG’s chart is coming off a high-distribution range and has moved into markdown. Momentum is weak, volume favors sellers, and the stock remains technically below critical support levels.
Analyst Ratings
📉 Public Service Enterprise Group (PEG) was recently downgraded by Ladenburg Thalmann on March 19, 2025. The rating was moved from buy to neutral, with a new price target set at $82.50. This shift comes after a closer look at the company’s recent financial trends and concerns about slowing earnings momentum. With revenue slipping and margin pressure mounting, the downgrade signals a more cautious stance, at least in the near term.
📊 Despite the downgrade, overall analyst sentiment toward PEG remains cautiously optimistic. The consensus 12-month price target sits at approximately $89.63. This suggests a modest upside from current levels and reflects a general belief in the company’s longer-term stability. Among analysts, the range of targets varies from as low as $80.00 to as high as $100.00, showing a mix of perspectives but leaning toward a positive trajectory.
🧾 The reasons behind recent analyst moves center on key issues: declining quarterly earnings, pressure on free cash flow, and the stock’s recent dip below major technical levels. That said, PEG’s consistent dividend, regulated utility structure, and infrastructure investments still provide a degree of resilience. Some analysts may be taking a pause after the stock’s strong 12-month performance, especially with interest rates remaining elevated.
📈 Many still see the stock as a reliable income play, even if short-term capital appreciation is less certain. The combination of modest price growth potential and solid dividend yield continues to make PEG a name that finds its way onto the radar of income-focused portfolios.
Earnings Report Summary
Public Service Enterprise Group recently shared its earnings results for the fourth quarter and the full year of 2024, and there’s a lot to unpack—especially if you’re tracking this utility for its income and stability.
In the final quarter of the year, the company delivered earnings of 57 cents per share. For the full year, net income landed at $3.54 per share, with adjusted (non-GAAP) earnings coming in a bit higher at $3.68. That’s right in line with what many expected, showing that PEG is staying on track operationally, even as the broader environment remains a bit uncertain.
Looking ahead, the company expects to earn around $3.94 per share in 2025 on an adjusted basis. That kind of guidance suggests management is feeling confident about its strategic direction, especially considering all the moving pieces—from grid investments to environmental goals.
One area that continues to stand out is PEG’s commitment to its dividend. In 2024, the company raised its dividend by 5.3%, marking the 13th consecutive year of increases and a staggering 117 years of uninterrupted payments. That consistency is rare, and it’s a key reason why so many income-focused investors keep this stock on their radar.
The utility arm, PSE&G, remains the backbone of the business. It accounted for about 90% of PEG’s adjusted operating earnings. That kind of contribution reinforces the stability of their regulated utility operations—something you like to see if you’re relying on a company for steady payouts.
On the investment front, PEG plans to spend between $18 and $21 billion over the next few years to modernize infrastructure and support clean energy efforts. Importantly, they’re doing this without planning to issue new shares or sell off parts of the business. That’s a smart move in today’s market—keeping things lean while still investing in the future.
They’re also continuing their push toward carbon neutrality by 2030. Projects like grid modernization, methane reduction programs, and customer-focused energy efficiency efforts are all in motion.
Overall, this was a solid, measured report. Nothing flashy, but PEG isn’t in the business of flash. They’re in the business of staying consistent—and that’s exactly what they delivered.
Financial Health and Stability
PEG’s financials show the profile of a company in investment mode. Total debt stands near $23 billion, and the debt-to-equity ratio is pushing 142%, which is definitely on the higher side. Liquidity’s a bit tight too, with a current ratio of just 0.65, suggesting they’re not exactly flush with short-term cash.
Still, this is a utility, and utilities tend to carry more debt than most sectors. The reason is simple: their revenues are predictable, and they can usually pass through costs to customers under regulatory approval. That stability gives them more leeway with leverage.
Profitability metrics offer a bit of reassurance. Operating margins are close to 19%, and return on equity is over 11%, both strong for a utility company. These numbers reflect a business that knows how to run efficiently, even with heavy capital spending in play.
If there’s one pressure point, it’s the negative levered free cash flow, which currently sits at around negative $1.5 billion. That’s a big number, and it reflects heavy investment. It’s not a sign of trouble, but it does mean PEG needs to execute well over the next couple of years to keep its balance sheet in shape.
Valuation and Stock Performance
PEG shares are trading right around $83, having climbed more than 27% over the past 12 months. That’s a solid outperformance compared to the broader market, and it tells us that investors are paying up for safety and yield.
Valuation-wise, PEG isn’t exactly cheap. The forward P/E ratio is just over 20, and the price-to-book sits near 3. Those numbers suggest investors are willing to pay a premium for PEG’s income reliability and low-volatility profile. That’s reinforced by the stock’s low beta of 0.62—it doesn’t move wildly, which is part of the appeal for dividend investors.
Enterprise value to EBITDA is close to 16, again on the high side. But this isn’t unusual for regulated utilities, especially during a period of infrastructure investment and renewable transition. The market seems to be pricing in confidence in PEG’s strategy.
Risks and Considerations
Every stock has its risks, and PEG is no exception. The most immediate issue is the company’s leverage. With debt levels this high, PEG is sensitive to interest rates, especially if inflation keeps borrowing costs elevated for longer than expected.
There’s also the matter of cash flow. Right now, PEG isn’t covering its capital spending and dividends with internally generated cash, which means it’s relying on debt markets. That’s fine in the short term, but it’s not a position you want to be stuck in for too long.
Regulatory risk also looms. As a utility, PEG is subject to the whims of state regulators. Changes in rate-setting mechanisms or political shifts could affect profitability. And finally, extreme weather and shifting energy demand patterns can have more impact than many investors realize—especially in a world where climate events are becoming less predictable.
Final Thoughts
PEG is about as steady as they come in the dividend world. It’s not a stock you buy for thrills, and it’s not going to deliver explosive dividend growth. But for investors looking to collect quarterly checks from a company that knows how to navigate the long game, PEG holds its ground well.
Its balance sheet is a little stretched, and its cash flow could use some attention. But profitability remains strong, and the dividend continues to rise—slowly but surely. For portfolios that lean toward low-volatility income, PEG continues to do what it has always done: deliver steady value over time.