Entergy
ETR
$106.49
-0.35%
Entergy Corporation is a holding company that owns and operates five regulated vertically integrated utilities, generating and distributing electricity to approximately 3 million customers across Arkansas, Louisiana, Mississippi, and Texas, with a generation fleet of 27 gigawatts. As one of the largest power producers in the U.S. and a former major nuclear owner, Entergy is a significant player in the regulated electric utility industry, distinct for its scale and focus on the Gulf South region. The current investor narrative centers on the company's strategic initiatives to support load growth from data centers and industrial customers, highlighted by a landmark $2 billion savings plan with Meta that funds grid expansion and positions Entergy for long-term growth, while also navigating the sale of its gas utilities and a premium valuation.…
ETR
Entergy
$106.49
Related headlines
Investment Opinion: Should I buy ETR Today?
We rate Entergy a Buy, supported by a consensus 'Buy' rating and an average price target of $124.21, implying 15.4% upside. The thesis is driven by strong revenue growth (11.97% YoY), a low PEG ratio of 0.38, and a stable regulated business model. The forward P/E of 21.19x is reasonable given expected EPS growth, and the dividend yield of 2.67% adds income appeal.
Sign up to view all
ETR 12-Month Price Forecast
The AI assessment is bullish, driven by strong revenue growth, a low PEG ratio, and positive analyst sentiment. However, the high debt and premium valuation warrant caution. The stance would be upgraded if revenue growth accelerates and debt levels decline, or downgraded if regulatory issues emerge or growth decelerates.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Entergy's 12-month outlook, with a consensus price target around $124.21 and implied upside of +16.6% versus the current price.
Average Target
$124.21
0 analysts
Implied Upside
+16.6%
vs. current price
Analyst Count
—
covering this stock
Price Range
$91 - $139
Analyst target range
Entergy is covered by 21 analysts, with a consensus recommendation of 'Buy' and a mean recommendation score of 1.71 (where 1 is Strong Buy and 5 is Sell). The average price target is $124.21, implying an upside of 15.4% from the current price of $107.62. The distribution shows a bullish lean, with recent actions from firms like Evercore ISI (upgraded to Outperform), Barclays (Overweight), and UBS (Buy), while Citigroup maintains a Neutral stance. The target range spans from a low of $91.00 to a high of $139.00, with the high target suggesting expectations of continued growth from grid investments and load expansion, while the low target reflects potential risks such as regulatory hurdles or cost overruns. The wide spread of $48 indicates moderate uncertainty, but the overall sentiment is positive, with no recent downgrades.
Bulls vs Bears: ETR Investment Factors
Entergy presents a balanced risk/reward profile. The bull case is anchored by strong revenue growth, a low PEG ratio, and a supportive analyst consensus, while the bear case highlights high debt, a premium valuation, and recent price weakness. Currently, the bull case has slightly stronger evidence due to the growth catalysts and attractive PEG, but the tension between growth potential and valuation premium is the key debate. If growth continues and regulatory approvals proceed smoothly, the stock could re-rate higher; conversely, any slowdown or regulatory setback could trigger multiple compression.
Bullish
- Strong Revenue Growth: Q1 2026 revenue grew 11.97% YoY to $3.19B, driven by industrial and commercial demand, including data centers. This acceleration from prior quarters signals robust load growth.
- Attractive PEG Ratio: PEG ratio of 0.38 suggests the stock is undervalued relative to its growth rate, despite a trailing P/E of 23.22x. This indicates the market may not fully price in future earnings growth.
- Analyst Consensus Buy: 21 analysts rate ETR a 'Buy' with a mean score of 1.71, and the average price target of $124.21 implies 15.4% upside. Recent upgrades from Evercore ISI, Barclays, and UBS reinforce positive sentiment.
- Meta Partnership Fuels Growth: The $2 billion savings plan with Meta funds grid expansion and supports long-term load growth, positioning Entergy to capitalize on data center demand. This landmark deal enhances the growth narrative.
Bearish
- High Debt Levels: Debt-to-equity ratio of 1.80 and negative free cash flow of -$3.0B TTM raise concerns about financial flexibility. High leverage could strain the balance sheet if interest rates remain elevated.
- Premium Valuation: Trailing P/E of 23.22x is above the industry average of 22x, and EV/EBITDA of 11.68x suggests a premium. If growth slows, multiple compression could pressure the stock.
- Recent Price Weakness: Stock is down 4.64% over the past month and 7.57% over three months, underperforming the S&P 500. This suggests waning momentum and potential investor caution.
- Regulatory Risks: As a regulated utility, Entergy faces regulatory approval risks for rate cases and cost recovery. Delays or unfavorable rulings could impact earnings and growth plans.
ETR Technical Analysis
Entergy's stock has exhibited a strong uptrend over the past year, with a 1-year price change of +19.01%, significantly outperforming the S&P 500's +18.19% over the same period. The current price of $107.62 sits at approximately 78% of the 52-week range (between $86.40 low and $118.45 high), indicating the stock is trading in the upper portion of its range but below the highs, suggesting a consolidation phase after a rally. This positioning implies that while momentum has been positive, the stock is not overextended, leaving room for potential upside if it breaks above resistance.
Beta
0.49
0.49x market volatility
Max Drawdown
-11.0%
Largest decline past year
52-Week Range
$86-$118
Price range past year
Annual Return
+18.0%
Cumulative gain past year
| Period | ETR Return | S&P 500 |
|---|---|---|
| 1m | -7.6% | +2.8% |
| 3m | -4.6% | +4.2% |
| 6m | +8.7% | +11.3% |
| 1y | +18.0% | +21.5% |
| ytd | +13.5% | +12.7% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
ETR Fundamental Analysis
Entergy's revenue trajectory shows solid growth, with Q1 2026 revenue of $3.19 billion, up 11.97% year-over-year from $2.85 billion in Q1 2025. This growth is driven by strong demand from commercial and industrial customers, particularly in the industrial segment ($934 million) and residential ($1.15 billion), reflecting the company's focus on serving growing load from data centers and manufacturing. The multi-quarter trend shows revenue increasing from $2.74 billion in Q4 2024 to $3.19 billion in Q1 2026, with a notable acceleration in Q1 2026, indicating a positive growth trajectory that supports the investment case.
Quarterly Revenue
$3.2B
2026-03
Revenue YoY Growth
+12.0%
YoY Comparison
Gross Margin
68.7%
Latest Quarter
Free Cash Flow
$-3.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is ETR Overvalued?
Given that Entergy has positive net income, the primary valuation metric selected is the P/E ratio. The trailing P/E is 23.22x, while the forward P/E is 21.19x, with the forward discount suggesting the market expects earnings growth. This is supported by a PEG ratio of 0.38, indicating that the stock is undervalued relative to its growth rate. Compared to the industry average P/E of 22x, Entergy trades at a slight premium of 5.5%, which is justified by its superior growth and stable regulated earnings. Historically, the stock's P/E has ranged from 5.43x (Q4 2023) to 120.16x (Q2 2024), with the current 23.22x near the middle of the range, suggesting a fair valuation relative to its own history.
PE
23.2x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 5x~54x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
11.7x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are significant, with a debt-to-equity ratio of 1.80 and negative free cash flow of -$3.0B TTM. The company's high leverage and capital-intensive nature make it vulnerable to rising interest rates, as evidenced by interest expenses of $379.7M in Q1 2026. Additionally, the current ratio of 0.73 indicates potential liquidity constraints, though regulated utilities often have access to capital markets. The payout ratio of 61.6% suggests dividend sustainability but limits retained earnings for growth.
FAQ
The key risks include high debt levels (debt-to-equity of 1.80), negative free cash flow, regulatory setbacks, and interest rate sensitivity. The stock's premium valuation leaves little room for error, and any slowdown in growth could lead to multiple compression. Additionally, the concentration on data center demand through the Meta partnership poses a specific risk if that sector cools.
The 12-month forecast is moderately bullish, with a base case target of $124.21 (50% probability), a bull case of $139 (30% probability), and a bear case of $91 (20% probability). The most likely scenario is steady growth driven by data center demand and regulatory approvals, leading to a stock price near the analyst average target.
ETR trades at a trailing P/E of 23.22x, slightly above the industry average of 22x, indicating a modest premium. However, the PEG ratio of 0.38 suggests the stock is undervalued relative to its growth rate. The forward P/E of 21.19x implies the market expects earnings growth. Overall, ETR is fairly valued, with the premium justified by its growth prospects.
ETR is a good buy for investors seeking a regulated utility with growth potential. The stock offers a 15.4% upside to the average analyst target of $124.21, supported by a low PEG ratio of 0.38 and strong revenue growth of 11.97% YoY. However, the high debt and premium valuation are risks. It is best suited for long-term investors who can tolerate some volatility in exchange for growth and income.
ETR is more suitable for long-term investment due to its regulated business model, low beta of 0.489, and dividend yield of 2.67%. The stock offers stability and growth potential, but short-term traders may find limited volatility. A minimum holding period of 3-5 years is recommended to fully benefit from the growth catalysts and dividend compounding.