Evergy
EVRG
$87.99
+0.51%
Evergy, Inc. is a regulated electric utility that generates, transmits, and distributes electricity to customers across eastern Kansas and western Missouri through operating subsidiaries including Evergy Metro, Evergy Kansas Central, Evergy Missouri West, and Evergy Transmission, operating a combined rate base exceeding $20 billion split roughly half in Kansas and the remainder across Missouri and interstate transmission. The company is a pure-play regulated wires-and-generation utility with a notable distinction as one of the largest wind energy suppliers in the United States, giving it a comparatively clean generation mix and a constructive positioning for data-center-driven load growth in the Midwest. The current investor narrative centers on accelerating capital investment and rate-base growth, evidenced by Q3 2026 revenue of $2.10 billion up 16.7% year-over-year and a sharp sequential margin recovery, alongside a broader utility sector rally as investors rotate toward defensive, rate-regulated cash flows amid a soft equity tape. Debate now hinges on whether the elevated capex program (roughly $960 million in Q2 2026 alone) and negative trailing free cash flow can be funded without diluting the 3.7% dividend yield, and whether constructive Kansas and Missouri rate outcomes can sustain the earnings trajectory that has driven the stock to near 52-week highs.…
EVRG
Evergy
$87.99
Related headlines
Investment Opinion: Should I buy EVRG Today?
Rating: Hold with a constructive bias. Evergy is a fairly valued, low-beta regulated utility whose core thesis is that a roughly $20 billion rate base, accelerating capex, and constructive Kansas and Missouri rate outcomes can compound earnings at a low-teens pace while paying a 3.67% dividend — but at $87.54, near 98.1% of the $71.41-$89.66 52-week range, the stock already discounts much of that story. The 11-of-14 buy consensus and $91.50 average target imply only about +4.5% upside, so the total-return case (roughly 8% including the dividend) is respectable but not compelling at this entry point.
Supporting evidence is solid on the operating side: Q3 2026 revenue of $2.097 billion grew 16.74% year-over-year, Q3 net income of $612.9 million produced a 29.2% net margin and 71.5% gross margin, and trailing operating margin of 25.19% is healthy for a regulated electric. Valuation is mid-range rather than stretched — 19.54x trailing and 19.16x forward earnings, 1.63x book against a historical 1.20x-1.95x band, and 12.0x EV/EBITDA — while the 3.67% yield with a 71.7% payout ratio provides an income floor. The offset is that trailing free cash flow is -$1.406 billion, the current ratio is 0.49, and debt-to-equity is 1.51x, meaning the dividend and capex are debt-funded and sensitive to interest costs.
The biggest risks that could invalidate the thesis are an adverse Kansas or Missouri rate decision limiting earned returns, a rise in interest expense on the debt-funded capex program, and a mild summer cutting the seasonally critical Q3. This Hold would upgrade to Buy on a pullback toward the $80-$81 support shelf (roughly 8-9% lower, restoring double-digit upside to the $91.50 target) or on a favorable rate-case outcome that lifts the high end of guidance toward the $100 target; it would downgrade to Sell if earned ROE (currently 8.37%) slips below allowed returns or if free cash flow deteriorates further without commensurate rate relief. Net verdict: fairly valued to slightly full relative to its own history and the utility group — a solid defensive income holding, not a bargain.
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EVRG 12-Month Price Forecast
Evergy is a high-quality regulated utility executing a credible rate-base growth story, but the shares at $87.54 already sit at 98.1% of their 52-week range and offer only about 4.5% upside to the $91.50 consensus target, so the risk/reward is balanced rather than compelling. The operating momentum is genuine — 16.74% revenue growth, a 29.2% Q3 net margin, and a 3.67% yield — but the -$1.406 billion free cash flow, 1.51x debt-to-equity, and 0.49 current ratio mean the dividend and capex depend on debt markets and constructive rate outcomes. Valuation at 19.16x forward earnings and 1.63x book is mid-range for the group, leaving limited multiple-expansion headroom unless rate cases surprise positively. I would upgrade to bullish on a pullback toward the $80-$81 support shelf or a favorable Kansas/Missouri rate order lifting guidance toward the $100 high target, and downgrade to bearish if earned ROE slips below allowed returns or free cash flow deteriorates further without rate relief.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Evergy's 12-month outlook, with a consensus price target around $91.50 and implied upside of +4.0% versus the current price.
Average Target
$91.50
16 analysts
Implied Upside
+4.0%
vs. current price
Analyst Count
16
covering this stock
Price Range
$80 - $100
Analyst target range
Evergy is covered by 14 analysts with a Buy/Hold/Sell distribution of 11/4/1, a consensus recommendation of "buy" and a recommendation mean of 1.81 (where 1.0 is a strong buy), indicating a clearly bullish but not unanimous stance. The average target price of $91.50 implies roughly +4.5% upside from the current $87.54, a modest return that, combined with the 3.67% dividend yield, still offers a total-return case in the high single digits. Consensus forward EPS of $5.94 (range $5.62 to $6.20) and revenue of $8.23 billion (range $7.89 billion to $8.51 billion) suggest analysts expect steady, low-teens earnings growth consistent with the regulated rate-base model, and the bullish tilt is reinforced by a steady stream of reaffirmed positive ratings from Barclays (Overweight), BMO (Outperform), Citigroup (Buy), and BofA (Buy) through 2026. The target range spans $80.00 to $100.00, a spread of about 25% around the average that signals moderate rather than high conviction. The $100 high target likely assumes successful and constructive rate-case outcomes in Kansas and Missouri, continued data-center and industrial load growth driving above-trend rate-base expansion, and multiple expansion toward the upper end of the utility peer group. The $80 low target, which sits below the current price, appears to price in margin compression from rising interest expense, funding pressure from the negative free cash flow and heavy capex program, or a less favorable regulatory outcome that limits earned returns. Institutional ratings show no downgrades in the visible record — all ten actions from February through October 2026 were reaffirmations of Buy/Outperform/Overweight or Neutral — which points to stable, if not accelerating, sell-side confidence; the tight clustering of targets near the average and the modest implied upside suggest the stock is fairly valued by the Street, with the low beta (0.469) and defensive profile making it a portfolio stabilizer rather than a high-upside catalyst-driven name.
Bulls vs Bears: EVRG Investment Factors
The bull case currently holds the stronger evidence: revenue is accelerating at 16.7% YoY, Q3 margins stepped up sharply to a 29.2% net margin, the stock is delivering +14.01% one-month relative strength against a falling market with a 0.469 beta, and 11 of 14 analysts rate it a buy. The bear case is real but largely structural rather than deteriorating: -$1.406 billion trailing free cash flow, a 0.49 current ratio, 1.51x debt-to-equity, and only +4.5% upside to the average target reflect a capital-intensive regulated model rather than a broken business. The single most important tension is whether the roughly $960 million quarterly capex program can be funded through debt and constructive Kansas and Missouri rate outcomes without diluting the 3.67% dividend or compressing earned returns. If rate cases deliver, the negative free cash flow is a growth investment; if they disappoint or interest costs rise, the same cash flow profile becomes the thesis-breaker.
Bullish
- Revenue accelerating at 16.7% YoY: Q3 2026 revenue of $2.097 billion rose 16.74% from $1.796 billion in Q3 2025, and climbed sequentially from $1.500 billion in Q2 and $1.444 billion in Q1 2026. This broad-based growth within a pure regulated model reflects new rate relief and recovering sales rather than a single volatile line, supporting durability of the earnings trajectory.
- Q3 margin step-up confirms earnings power: Q3 2026 net income of $612.9 million produced a 29.2% net margin and 71.5% gross margin, versus just 14.3% and 10.5% net margins in Q2 and Q1 2026 respectively. The seasonal summer quarter demonstrates the underlying earnings power unlocked by recent rate outcomes, with operating margin reaching 38.6%.
- Defensive leadership with 14% relative strength: EVRG is up 9.02% over the past month while SPY fell 4.99%, producing +14.01% relative strength, and +9.90% over three months against a -4.91% index. With a beta of just 0.469, the stock is delivering this outperformance with roughly half the market's volatility, signaling genuine capital rotation into regulated utilities.
- Analyst consensus buy with $91.50 target: Of 14 analysts, 11 rate EVRG a buy against 4 holds and 1 sell, yielding a recommendation mean of 1.81 and an average target of $91.50, about +4.5% above the $87.54 price. Combined with the 3.67% dividend yield, this supports a high-single-digit total-return case, and all ten visible rating actions from February through October 2026 were reaffirmations with no downgrades.
Bearish
- Negative $1.41 billion free cash flow: Trailing free cash flow is -$1.406 billion as capex of roughly $960 million in Q2 and $852 million in Q1 2026 outruns operating cash flow. The 3.67% dividend, with a 71.7% payout ratio, is covered by earnings but not by free cash flow, meaning both the dividend and growth capex are effectively funded through debt issuance.
- Thin liquidity and 1.51x debt-to-equity: The current ratio of just 0.49 and cash of only $27.3 million highlight a reliance on external financing, with total debt-to-capitalization near 59.6% and debt-to-equity at 1.51x. This structure leaves Evergy acutely sensitive to interest rates and credit conditions precisely as it funds an elevated capex program.
- Only 4.5% upside to average target: The $91.50 average target implies just +4.5% from $87.54, and the $80 low target sits below the current price, pricing in margin compression or unfavorable regulatory outcomes. The $80-$100 range is a roughly 25% spread that signals moderate rather than high conviction, and the tight clustering near the average suggests the Street sees the stock as fairly valued.
- Pinned near 52-week high at 98% of range: At $87.54, the stock sits at roughly 98.1% of its $71.41-$89.66 52-week range, leaving limited margin of safety and raising profit-taking risk near the $89.66 resistance. The 1-month surge of 9.02% is nearly double the 3-month gain of 4.99%, and such vertical short-term moves often invite consolidation.
EVRG Technical Analysis
Evergy is in a sustained, orderly uptrend, with the stock up 15.85% over the trailing year and 19.79% year-to-date, and the current price of $87.54 sits at roughly 98.1% of its 52-week range of $71.41 to $89.66. That positioning just below the 52-week high signals persistent accumulation and momentum rather than a value opportunity, though it also leaves limited margin of safety and raises the risk of profit-taking near the $89.66 resistance. The stock's advance has been remarkably steady rather than parabolic, consistent with a low-beta defensive utility being re-rated rather than a speculative squeeze. Recent momentum is clearly accelerating: the 1-month change of +9.02% is nearly double the 3-month gain of +4.99% and well ahead of the 6-month +7.04%, indicating the pace of appreciation has picked up materially in the last several weeks rather than decelerating. Critically, this strength is occurring against a weak tape, with SPY down 4.99% over the past month and 4.91% over three months, producing relative strength readings of +14.01% (1-month) and +9.90% (3-month) versus the index — a powerful signal of defensive leadership and capital rotation into utilities. The 1-month surge above the 1-year trend rate suggests momentum is being driven by a fresh catalyst (likely the November 5 Q3 filing and rate-case optimism) rather than simple mean reversion, though such vertical short-term moves often invite consolidation. Key technical levels are well defined: support sits at the 52-week low of $71.41, with intermediate support around the $80-$81 shelf that repeatedly held in August and September 2026, while resistance is the $89.66 52-week high. A breakout above $89.66 would confirm the uptrend and likely open a new leg higher, whereas a breakdown below $80 would signal the momentum trade is unwinding and refocus attention on the $71.41 floor. Volatility is exceptionally low, with a beta of just 0.469 — roughly 53% less volatile than the market — meaning position sizing can be larger for equivalent risk and that drawdowns (max drawdown of -11.88% over the period) tend to be shallow and gradual rather than sharp, reinforcing the stock's role as a low-volatility defensive holding.
Beta
0.47
0.47x market volatility
Max Drawdown
-11.9%
Largest decline past year
52-Week Range
$71-$90
Price range past year
Annual Return
+16.4%
Cumulative gain past year
| Period | EVRG Return | S&P 500 |
|---|---|---|
| 1m | +8.7% | -3.3% |
| 3m | +7.3% | -2.3% |
| 6m | +6.7% | +1.4% |
| 1y | +16.4% | +12.2% |
| ytd | +20.4% | +10.4% |
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EVRG Fundamental Analysis
Revenue is on a clear and accelerating growth trajectory: Q3 2026 revenue reached $2.097 billion, up 16.74% year-over-year versus Q3 2025's $1.796 billion, and up sequentially from $1.500 billion in Q2 2026 and $1.444 billion in Q1 2026. The sequential climb reflects both seasonal summer cooling demand and, more importantly, the impact of new rates and recovering sales, with the single Electric Utility segment contributing $7.58 billion in reported segment revenue. This growth is broad-based within a pure regulated model rather than driven by a single volatile line, which supports the durability of the investment case and underpins management's ability to grow rate base and earnings. Profitability is robust and improving sharply: Q3 2026 net income was $612.9 million (a 29.2% net margin) with gross margin of 71.5% and operating margin of 38.6%, a dramatic step-up from Q2 2026's $215.0 million net income (14.3% margin) and Q1 2026's $151.5 million (10.5% margin). The quarterly margin volatility is typical of regulated utilities, where weather and rate timing swing results, but the Q3 print confirms the underlying earnings power and the benefit of recent rate relief. Trailing net margin of 14.45% and operating margin of 25.19% are healthy for a regulated electric utility, and the 32.3% gross margin on a trailing basis (versus 71.5% in the seasonally strong Q3) underscores the importance of the summer quarter to full-year results. Balance sheet and cash flow present the key watch item: debt-to-equity stands at 1.51x with total debt-to-capitalization near 59.6%, and trailing free cash flow is deeply negative at -$1.406 billion as capital expenditures (roughly $960 million in Q2 2026 and $852 million in Q1 2026) outrun operating cash flow. The current ratio of just 0.49 and cash of only $27.3 million highlight thin liquidity and reliance on external financing, while ROE of 8.37% and ROA of 3.12% are modest but consistent with the regulated-return model. The 3.67% dividend yield with a 71.7% payout ratio is covered by earnings but not by free cash flow, meaning the dividend and growth capex are effectively funded through debt issuance — a standard utility structure but one that leaves the company sensitive to interest rates and credit conditions.
Quarterly Revenue
$2.1B
2026-09
Revenue YoY Growth
+16.7%
YoY Comparison
Gross Margin
71.5%
Latest Quarter
Free Cash Flow
$-1.4B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is EVRG Overvalued?
Because Evergy is solidly profitable (Q3 2026 net income of $612.9 million; trailing EPS positive), the PE ratio is the appropriate primary metric, and the stock trades at 19.54x trailing earnings versus 19.16x forward — an unusually narrow gap that implies the market expects only modest earnings growth, consistent with the consensus forward EPS of $5.94 against a low-teens growth utility profile. The near-parity of trailing and forward multiples signals that valuation is being driven by the stability of regulated cash flows and the dividend rather than by aggressive growth expectations, and the negative PEG ratio (-9.26) is a data artifact of the tiny trailing EPS base rather than a meaningful signal. Against the broader utility sector, Evergy's 19.5x PE and 1.63x price-to-book look reasonable for a regulated electric with a 3.7% yield, though its 2.82x price-to-sales and 5.77x EV/sales are elevated relative to historical utility norms, and the 12.0x EV/EBITDA sits in a normal range for the group. The 1.63x P/B is modest for a utility with an 8.4% ROE, suggesting the market is not paying a rich premium for the asset base, while the 3.67% dividend yield is competitive and provides a valuation floor for income-oriented investors. Historically, Evergy's PE has ranged wildly — from roughly 7.4x in Q3 2026's seasonal peak-earnings quarter to 48.98x in Q4 2025's seasonally weak quarter — so the current 19.5x trailing figure is best read as mid-range on a normalized basis rather than at an extreme. The stock's P/B of 1.63x compares with a historical band of roughly 1.20x to 1.95x over the past several years, placing it in the upper-middle of its own range, which suggests the market is pricing in constructive rate outcomes and continued capex-driven rate-base growth but is not yet at euphoric levels. On balance, valuation looks fair-to-slightly-full for a low-beta regulated utility, with the dividend yield and defensive characteristics providing support but limited multiple expansion headroom unless rate-case outcomes surprise positively.
PE
19.5x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 7x~52x
vs. Industry Avg
19.0x
Industry PE ~19.0x*
EV/EBITDA
12.0x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on the funding gap created by the capex program. Trailing free cash flow of -$1.406 billion against roughly $960 million of Q2 2026 capex and $852 million in Q1 means the 3.67% dividend (71.7% payout ratio) and growth investment are financed through debt, with debt-to-equity at 1.51x and total debt-to-capitalization near 59.6%. Liquidity is thin at a 0.49 current ratio and only $27.3 million of cash, so any disruption to capital markets access or a rise in borrowing costs directly pressures earned returns and the dividend's cash coverage. Earnings are also seasonally concentrated, with Q3 2026 net income of $612.9 million dwarfing Q1's $151.5 million, leaving results exposed to summer weather.
Market and competitive risks are moderate given the regulated model but not negligible. At 19.54x trailing and 19.16x forward earnings, the near-parity multiple leaves little room for multiple expansion, and the 2.82x price-to-sales and 5.77x EV/sales are elevated versus historical utility norms, so any de-rating toward the lower end of the 1.20x-1.95x P/B band could compress the shares. The 0.469 beta means EVRG is less exposed to broad market swings, but that same defensiveness makes it vulnerable to sector rotation if investors rotate back out of utilities into cyclicals, and the recent +14.01% one-month relative strength reflects exactly the kind of crowded defensive trade that can unwind. Peer results from WTRG, ONE Gas, and WEC Energy all beating on rate recovery and demand reinforce that regulatory outcomes, not competition, are the swing factor.
A worst-case scenario would combine an adverse Kansas or Missouri rate decision limiting earned returns, rising interest expense on the debt-funded capex program, and a mild summer cutting Q3 earnings, triggering analyst downgrades and a de-rating toward the low end of the P/B range. In that chain, the stock could retrace to the $80 low analyst target, roughly -8.6% from $87.54, and in a more severe risk-off rotation to the $71.41 52-week low, about -18.4%. The historical max drawdown of -11.88% suggests such moves tend to be gradual rather than sharp, but from a price sitting at 98.1% of its 52-week range, the asymmetry is unfavorable: limited upside to the $89.66 high versus a double-digit downside to well-established support.
FAQ
The most severe risk is financial: trailing free cash flow of -$1.406 billion against roughly $960 million of quarterly capex, a 0.49 current ratio and 1.51x debt-to-equity mean the 3.67% dividend (71.7% payout ratio) and growth investment are debt-funded and sensitive to interest costs, which already reached $168.0 million in Q3 2026. Second is regulatory risk — earned ROE of 8.37% versus allowed returns means an adverse Kansas or Missouri rate decision could cap returns and push the stock toward the $80 low target. Third is valuation and rotation risk: at 98.1% of the 52-week range and 19.16x forward earnings, the +14.01% one-month relative strength reflects a crowded defensive trade that could unwind if investors rotate back into cyclicals. Fourth is weather and seasonality — Q3 2026 generated $612.9 million of net income versus $151.5 million in Q1, so a mild summer would materially swing full-year results.
The 12-month forecast is anchored by three scenarios: a base case at 55% probability targeting $88-$94 around the $91.50 average analyst target, a bear case at 25% probability targeting $71.41-$80, and a bull case at 20% probability targeting $95-$100 near the analyst high. The base case is most likely and assumes forward EPS lands near the $5.94 consensus midpoint, Kansas and Missouri rate outcomes are constructive but not exceptional, and interest expense stays contained at 1.51x debt-to-equity, producing a high-single-digit total return including the 3.67% dividend. The bull case requires favorable final rate orders or data-center and industrial load contracts driving above-trend rate-base expansion, while the bear case hinges on an adverse rate decision, rising interest costs, or a mild summer cutting the seasonally critical Q3. The wide $80-$100 analyst range (about 25% around the average) signals moderate rather than high conviction.
EVRG looks fairly valued to slightly full rather than cheap: it trades at 19.54x trailing and 19.16x forward earnings, a narrow gap that implies the market expects only modest growth, consistent with consensus forward EPS of $5.94. The 1.63x price-to-book sits in the upper-middle of its historical 1.20x-1.95x band, and the 12.0x EV/EBITDA and 2.82x price-to-sales are normal-to-elevated for a regulated electric, while the 3.67% dividend yield provides a valuation floor. The market is paying for stability and rate-base growth rather than a bargain — the 8.37% ROE is modest relative to the book multiple, and the $91.50 average target implies only about +4.5% upside. In short, the price embeds constructive Kansas and Missouri rate outcomes and continued capex-driven rate-base expansion, leaving limited multiple-expansion headroom unless rate cases surprise positively.
From a risk/reward standpoint, EVRG is a reasonable but not compelling buy at $87.54: the 11-of-14 buy consensus and $91.50 average target offer only about +4.5% price upside, though the 3.67% dividend lifts the total-return case to the high single digits. The downside is well defined but real — the $80 low analyst target sits about 8.6% below the current price and the $71.41 52-week low about 18.4% below — while the stock trades at 98.1% of its 52-week range with a 0.469 beta that limits both upside and downside volatility. The operating backdrop is supportive, with Q3 2026 revenue up 16.74% year-over-year and a 29.2% net margin, but trailing free cash flow of -$1.406 billion and a 0.49 current ratio mean the dividend depends on debt markets and constructive rate outcomes. It is a good buy primarily for income-oriented, defensive investors who can tolerate modest upside and want utility exposure, and a better entry would be a pullback toward the $80-$81 support shelf that restores double-digit upside to the consensus target.
EVRG is better suited to long-term, income-oriented holding than short-term trading: its 0.469 beta means it moves at roughly half the market's volatility, so short-term price swings offer limited trading opportunity, and the 3.67% dividend with a 71.7% payout ratio rewards patience. The regulated rate-base model provides high earnings visibility — consensus forward EPS of $5.94 and revenue of $8.23 billion — but the growth is steady rather than explosive, and the stock already sits at 98.1% of its 52-week range, limiting near-term upside to the $91.50 target. A minimum holding period of 12-24 months makes sense to capture at least one full rate-case cycle and the dividend, and the low volatility means position sizing can be larger for equivalent risk. Short-term traders should note the stock's recent +9.02% one-month surge and the risk of consolidation near the $89.66 resistance.