Consolidated Edison, Inc. (ED)

Consolidated Edison, Inc. (ED) Utility Operations & Dividend Profile

Consolidated Edison, Inc. (ED) is a major regulated utility providing essential electric, gas, and steam delivery services to millions of customers in the New York City metropolitan area. The company's focus on infrastructure investments and renewable energy projects positions it within a stable, yet evolving, utility landscape.

What Is the Investment Thesis for ED?

Consolidated Edison presents a stable investment opportunity due to its regulated utility business model and essential service offerings. The company's consistent profitability, reflected in a 12.5% profit margin, and a dividend yield of 3.23% make it attractive for income-focused investors. Growth catalysts include ongoing investments in renewable energy infrastructure and upgrades to existing transmission and distribution networks. However, potential risks include regulatory changes, increasing operating costs, and the impact of severe weather events on infrastructure. The company's beta of 0.34 indicates lower volatility compared to the broader market, suggesting a relatively stable investment profile. Investors should monitor the company's ability to navigate regulatory challenges and maintain its infrastructure to ensure continued service reliability and profitability.

Based on FMP financials and quantitative analysis

ED Key Highlights

• Market capitalization of $42.01B, reflecting its significant presence in the utility sector.
• P/E ratio of 18.1, indicating a moderate valuation compared to its earnings.
• Profit margin of 12.5%, demonstrating consistent profitability in a regulated environment.
• Gross margin of 65.0%, highlighting efficient operations in its core business segments.
• Dividend yield of 3.23%, offering an attractive income stream for investors.

Who Are ED's Competitors?

ED is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are ED's Key Strengths?

• Stable revenue stream due to regulated utility business model.
• High barriers to entry due to extensive infrastructure and regulatory requirements.
• Strong brand recognition and reputation for reliable service.
• Commitment to renewable energy and sustainability initiatives.

What Are ED's Weaknesses?

• Exposure to regulatory risks and potential changes in government policies.
• High capital expenditures required for infrastructure maintenance and upgrades.
• Dependence on weather conditions and potential for service disruptions due to extreme events.
• Limited growth opportunities outside of its regulated service areas.

What Could Drive ED Stock Higher?

• Investments in renewable energy projects, driven by state and federal mandates, are expected to increase revenue and earnings.
• Infrastructure modernization projects, including smart grid technologies and upgrades to transmission and distribution networks, will improve service reliability and reduce outages.
• Regulatory approvals for new rate cases are expected to provide clarity on future revenue streams and investment plans.
• Expansion of electric vehicle charging infrastructure will support the growing adoption of EVs and increase electricity demand.

What Are the Key Risks for ED?

• Financial-distress signal — its Altman Z-Score of 1.27 sits in the distress zone (elevated bankruptcy risk).
• Regulatory changes and potential for stricter environmental regulations could increase compliance costs and impact profitability.
• Cybersecurity threats and potential for disruptions to critical infrastructure could result in service outages and financial losses.
• Rising operating costs and inflationary pressures could erode profit margins.
• Severe weather events and natural disasters could cause significant damage to infrastructure and disrupt service.
• Dependence on regulatory approvals for rate increases may limit revenue growth.

What Are the Growth Opportunities for ED?

• Growth opportunity 1: Expansion of renewable energy projects represents a significant growth opportunity for Consolidated Edison. The company is actively investing in solar, wind, and other renewable energy sources to meet increasing demand for clean energy and comply with state and federal mandates. These projects not only contribute to environmental sustainability but also provide long-term revenue streams through power purchase agreements and renewable energy credits. The market for renewable energy is expected to grow substantially, driven by government incentives and declining technology costs.
• Growth opportunity 2: Infrastructure modernization and grid hardening initiatives offer another avenue for growth. Consolidated Edison is continuously upgrading its transmission and distribution networks to improve reliability, reduce outages, and accommodate increasing electricity demand. These investments include replacing aging equipment, implementing smart grid technologies, and enhancing cybersecurity measures. The need for infrastructure upgrades is driven by factors such as extreme weather events, population growth, and the electrification of transportation.
• Growth opportunity 3: Electrification of transportation presents a long-term growth opportunity for Consolidated Edison. As electric vehicle adoption increases, the demand for electricity to power these vehicles will also rise. The company is well-positioned to benefit from this trend by providing the necessary infrastructure and grid capacity to support EV charging. This includes investing in charging stations, upgrading substations, and implementing smart grid technologies to manage the increased load.
• Growth opportunity 4: Energy efficiency programs and demand response initiatives can drive growth by reducing overall energy consumption and optimizing grid utilization. Consolidated Edison offers various programs to incentivize customers to adopt energy-efficient technologies and practices. These programs not only help customers save money but also reduce the strain on the grid, allowing the company to defer costly infrastructure investments. The market for energy efficiency is expected to grow as energy prices rise and consumers become more aware of the benefits of conservation.
• Growth opportunity 5: Expansion of gas distribution networks in underserved areas represents a potential growth opportunity. While the focus is shifting towards electrification, natural gas remains an important energy source for heating and industrial processes. Consolidated Edison can expand its gas distribution networks to reach new customers and provide them with access to reliable and affordable energy. This includes extending pipelines, upgrading existing infrastructure, and implementing safety measures to prevent leaks and ensure reliable service.

What Opportunities Does ED Have?

• Expansion of renewable energy projects and investments in clean energy technologies.
• Modernization of grid infrastructure and implementation of smart grid technologies.
• Electrification of transportation and increased demand for electricity to power electric vehicles.
• Development of energy efficiency programs and demand response initiatives.

What Threats Does ED Face?

• Increasing competition from alternative energy sources and distributed generation.
• Cybersecurity threats and potential for disruptions to critical infrastructure.
• Rising operating costs and inflationary pressures.
• Potential for stricter environmental regulations and increased compliance costs.

What Are ED's Competitive Advantages?

• Regulated utility status provides a natural monopoly in its service areas.
• Extensive infrastructure network creates high barriers to entry for competitors.
• Long-standing relationships with customers and government agencies.
• Brand recognition and reputation for reliable service.

What Does ED Do?

Consolidated Edison, Inc., founded in 1823 and headquartered in New York City, operates as a regulated utility company, delivering electricity, gas, and steam to customers in the United States. The company's primary service area includes New York City and Westchester County, where it provides electric services to approximately 3.5 million customers. Additionally, it supplies gas to around 1.1 million customers in Manhattan, the Bronx, parts of Queens, and Westchester County, as well as steam to approximately 1,555 customers in parts of Manhattan. Beyond its core service area, Consolidated Edison also provides electricity to approximately 0.3 million customers and gas to approximately 0.1 million customers in southeastern New York and northern New Jersey. The company's infrastructure includes extensive transmission and distribution networks, comprising 533 circuit miles of transmission lines, 15 transmission substations, 64 distribution substations, and thousands of miles of both overhead and underground distribution lines. Furthermore, Consolidated Edison is actively involved in renewable energy projects, owning, operating, and developing various renewable and energy infrastructure initiatives. The company sells electricity primarily to industrial, commercial, residential, and government customers, playing a crucial role in the energy supply of the New York metropolitan area.

What Products and Services Does ED Offer?

• Delivers electricity to approximately 3.5 million customers in New York City and Westchester County.
• Provides gas to approximately 1.1 million customers in Manhattan, the Bronx, parts of Queens, and Westchester County.
• Supplies steam to approximately 1,555 customers in parts of Manhattan.
• Supplies electricity to approximately 0.3 million customers in southeastern New York and northern New Jersey.
• Supplies gas to approximately 0.1 million customers in southeastern New York.
• Owns, operates, and develops renewable and energy infrastructure projects.
• Provides energy-related products and services to wholesale and retail customers.
• Invests in electric and gas transmission projects.

How Does ED Make Money?

• Generates revenue through regulated electric, gas, and steam delivery services.
• Sells electricity, gas, and steam to residential, commercial, industrial, and government customers.
• Invests in and operates renewable energy projects, generating revenue through power purchase agreements and renewable energy credits.
• Provides energy-related products and services to wholesale and retail customers.

What Industry Does ED Operate In?

Consolidated Edison operates within the regulated electric utility industry, characterized by stable demand and government oversight. The industry is undergoing a transformation with increasing adoption of renewable energy sources and modernization of grid infrastructure. Key competitors include ETR: Entergy Corporation, PEG: Public Service Enterprise Group Incorporated, WEC: WEC Energy Group, Inc., PCG: Pacific Gas & Electric Co., and AEE: Ameren Corporation. These companies operate in different geographic regions but face similar challenges related to regulatory compliance, infrastructure investments, and the transition to cleaner energy sources. The industry is also influenced by factors such as energy efficiency initiatives, electric vehicle adoption, and distributed generation technologies.

Who Are ED's Key Customers?

• Residential customers in New York City and Westchester County.
• Commercial businesses in New York City and Westchester County.
• Industrial facilities in New York City and Westchester County.
• Government entities in New York City and Westchester County.

Net buyingInsider Activity

Over the past six months, Consolidated Edison, Inc. insiders filed 30 SEC Form 4 transactions — 8 sales and 22 purchases. On net that is roughly 25K shares acquired (about $409K) — insiders putting money in tends to read as conviction.

ED Valuation & Market Position

With a $42.01B market cap, Consolidated Edison, Inc. sits in the large-cap segment of the market. Relative to its peer group, ED's quantitative score of 81/100 is above the peer average of 66/100.

ROE 9%Key Financial Metrics

Return on equity for Consolidated Edison, Inc. stands at 8.8%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 2.9%, showing how much profit it generates from its asset base. ED trades at a trailing price-to-earnings ratio of 18.12, below the Utilities sector average of ~28x. Its free cash flow yield is 7.1%, a gauge of the cash the business throws off relative to its market value. A current ratio of 1.19 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 5.5%, the inverse of the P/E and a quick read on earnings relative to price.

F-Score 6/9Financial Health

Consolidated Edison, Inc.'s Piotroski F-Score is 6/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 1.27 places it in the distress zone, a signal of elevated financial risk.

FY2026 estForward Outlook

Wall Street analysts project Consolidated Edison, Inc. revenue of about $17.53B for fiscal 2026, with EPS near $6.10. The estimate reflects 10 contributing analysts.

Company Profile

Consolidated Edison, Inc. operates in the Regulated Electric industry within the Utilities sector. It is headquartered in New York City, US. The company is led by CEO Timothy Cawley. ED has traded publicly since 2001.

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Consolidated Edison, Inc. Utilities Stock: Key Questions Answered

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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