WEC Energy Group Inc
🇺🇸 WEC · NYSE/NASDAQ · US92939U1060
Utilities
USD 116.15 price at analysis
Scores
Key Metrics
Powered by EODHDP/E (TTM)
24.4
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Calculation: 116.15 ÷ 4.75 = 24.4
TTM period through: 2025-12-31
Forward P/E (estimated): 20.9
Based on analyst estimates
Reference: Provider P/E (Trailing): 24.1
Yield (Fwd)
3.28%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Trailing Yield (TTM): 3.07%
Net Debt/EBITDA (TTM)
5.5x
Latest quarter: 24.1x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
TTM through: 2025-12-31
Latest quarter (2025-12-31): 24.1x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
Payout (Fwd)
80.2%
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Payout (TTM): 73.7%
Cash Flow Payout (TTM): 34.0%
FCF Coverage (TTM): -0.89x
ROE
11.6%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
14.9x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
📊 What Changed From Last Analysis?
Moved from WATCH to OPTIMAL: Reassessed valuation utilizing P/FFO (10.9x) rather than GAAP P/E (24.4x), as P/FFO more accurately captures the robust cash generation beneath WEC's heavy capital investment program. On an FFO basis, shares are fundamentally undervalued.
Summary
WEC Energy Group is a premium regulated utility providing essential electricity and natural gas services across the Midwest, underpinned by a highly reliable monopoly business model. While standard earnings multiples appear elevated, the company's Price-to-FFO of 10.9x reveals strong underlying cash generation beneath its massive $37.5B infrastructure modernization plan. Trading at $116.15 vs a P/FFO fair value range of $127-191, the stock is worth considering for new positions, offering a secure 3.1% yield backed by structural data center load growth.
Sector Context
Utilities operate as regulated monopolies providing essential electricity and natural gas services, offering highly predictable cash flows. For utilities undergoing massive infrastructure upgrades, standard GAAP P/E ratios are often distorted by significant non-cash depreciation expenses; therefore, Price to Funds From Operations (P/FFO) is the preferred metric to evaluate true cash-generating ability and dividend sustainability.
📊 Strategy Analysis
- • Trading at $116.15, below our P/FFO fair value range of $127-191, offering attractive upside potential driven by structural data center demand.
- • P/FFO of 10.9x indicates the stock is cheap relative to its true operating cash flow, revealing strong fundamentals despite the GAAP P/E of 24.4x being inflated by heavy depreciation.
- • Exceptional dividend reliability with 10 consecutive years of growth and a conservative Cash Flow Payout ratio of 34%, ensuring the 3.07% yield remains highly secure.
⚠ What to Watch
- • Free cash flow is heavily negative (-$905.4M) due to aggressive $37.5B infrastructure and grid modernization investments, requiring ongoing external debt or equity financing.
- • Net Debt to EBITDA of 5.51x is elevated even for a utility, leaving slightly less financial flexibility in a prolonged higher interest rate environment.
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Dividend Sustainability (FCF vs Dividends Paid)
Free cash flowFree Cash Flow
Cash left after the company pays for running the business and maintaining it. Often used to fund dividends, pay debt, or buy back shares. (FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., blue) should cover dividends paidDividends Paid
Cash the company paid out to shareholders. It’s not guaranteed and can change over time. (green). If dividends consistently exceed FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., the dividend may be at risk.
Analysis date: 2026-04-18
Disclaimer: This information is for educational purposes only. Not financial advice.