As of April 4, 2026, Public Service Enterprise Group Inc's estimated intrinsic value ranges from $80.98 to $251.56 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $104.26 | +27.4% |
| Discounted Cash Flow (5Y) | $99.05 | +21.1% |
| Dividend Discount Model (Multi-Stage) | $80.98 | -1.0% |
| Dividend Discount Model (Stable) | $94.12 | +15.0% |
| Earnings Power Value | $251.56 | +207.5% |
Is Public Service Enterprise Group Inc (PEG) undervalued or overvalued?
With the current market price at $81.82, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Public Service Enterprise Group Inc's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.39 | 0.48 |
| Cost of equity | 5.7% | 7.6% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 7.8% | 13.4% |
| Debt/Equity ratio | 0.6 | 0.6 |
| After-tax WACC | 4.9% | 6.2% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $99 | $73,342M | 84.3% |
| 10-Year Growth | $104 | $75,939M | 70.9% |
| 5-Year EBITDA | $51 | $49,211M | 76.6% |
| 10-Year EBITDA | $62 | $54,811M | 59.7% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $8,209M |
| Discount Rate (WACC) | 6.2% - 4.9% |
| Enterprise Value | $132,056M - $166,755M |
| Net Debt | $23,942M |
| Equity Value | $108,114M - $142,813M |
| Outstanding Shares | 499M |
| Fair Value | $217 - $286 |
| Selected Fair Value | $251.56 |
| Metric | Value |
|---|---|
| Market Capitalization | $40807M |
| Enterprise Value | $64749M |
| Trailing P/E | 19.33 |
| Forward P/E | 18.44 |
| Trailing EV/EBITDA | 6.90 |
| Current Dividend Yield | 312.52% |
| Dividend Growth Rate (5Y) | 5.10% |
| Debt-to-Equity Ratio | 0.60 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $31.28 |
| Discounted Cash Flow (5Y) | 25% | $24.76 |
| Dividend Discount Model (Multi-Stage) | 20% | $16.20 |
| Dividend Discount Model (Stable) | 15% | $14.12 |
| Earnings Power Value | 10% | $25.16 |
| Weighted Average | 100% | $111.51 |
Based on our comprehensive valuation analysis, Public Service Enterprise Group Inc's intrinsic value is $111.51, which is approximately 36.3% above the current market price of $81.82.
Key investment considerations:
Given these factors, we believe Public Service Enterprise Group Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.