ED Stock Risk & Deep Value Analysis
Consolidated Edison Inc
DVR Score
out of 10
What You Need to Know About ED Stock
We analyzed Consolidated Edison Inc using our deep value framework. Sign in to see our full verdict and DVR Score.
We ran ED through our deep value framework — analyzing financial health, distress signals, competitive moat, and risk factors. Our risk assessment: Conservative. Here's what we found.
ED Risk Analysis & Red Flags
What Could Go Wrong
The regulated nature of Con Edison's business means that significant unfavorable regulatory decisions, such as penalties from the ongoing NYSPSC audit or restrictions on rate increases, could limit its ability to recover costs and invest in necessary infrastructure, potentially dampening modest earnings growth and impacting dividend sustainability over time.
Risk Matrix
Overall
Conservative
Financial
Medium
Market
Low
Competitive
Low
Execution
Low
Regulatory
Medium
Red Flags
- ⚠
Business model fundamentally incompatible with 10x growth potential.
- ⚠
Ongoing share dilution (7M common shares offering) without corresponding hyper-growth projects.
- ⚠
High PEG ratio (2.65) indicating valuation premium relative to its low-growth prospects.
Upcoming Risk Events
- 📅
Unfavorable outcome from NYSPSC audit leading to fines or rate adjustments
- 📅
Significant increases in interest rates impacting debt servicing costs and capital expenditure financing
When to Reconsider
- 🚪
Significant and sustained reduction in regulated rate of return allowances by the NYSPSC.
- 🚪
A material and unexpected reduction in the quarterly dividend.
- 🚪
Sustained increase in operational costs that cannot be passed through to customers via rate cases.
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Investment Thesis
Con Edison is a highly stable, regulated utility providing essential electricity, gas, and steam services in the New York metropolitan area. It possesses a wide economic moat due to its regulated monopoly status and extensive infrastructure, making it a reliable dividend-payer and a defensive holding in volatile markets. This company is a strong candidate for income-focused portfolios seeking stability, but its business model fundamentally precludes the 10x growth potential sought by this specific investment strategy.
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ED Price Targets & Strategy
12-Month Target
$112.00
Bull Case
$118.00
Bear Case
$97.00
Valuation Basis
Based on 18.5x forward P/E applied to estimated FY26 EPS of $6.05 (mid-point of guidance $6.00-$6.20).
Entry Strategy
For income investors, consider dollar-cost averaging on dips towards the $100-$105 range, aligning with recent analyst support levels.
Exit Strategy
For income/stability investors, consider profit-taking if the stock trades significantly above its historical P/E multiple range (e.g., above 20x forward EPS). Stop loss could be placed if the dividend yield significantly deteriorates or if a major regulatory setback occurs.
Portfolio Allocation
0% for a high-risk, high-reward 10x growth strategy. For a diversified, income-focused portfolio, 1-3% for conservative risk tolerance.
Price Targets & Strategy
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Is ED Financially Healthy?
Valuation
P/E Ratio
19.93
Forward P/E
17.79
EV/EBITDA
8.90
PEG Ratio
2.80
Price/Book
1.65
Price/Sales
2.41
Profitability
Gross Margin
46.69%
Operating Margin
17.33%
Net Margin
11.95%
Return on Equity
8.43%
Revenue Growth
10.85%
EPS
$5.65
Balance Sheet
Current Ratio
1.02
Quick Ratio
0.88
Debt/Equity
1.15
Cash Flow
EBITDA
$7.57B
Other
Beta (Volatility)
0.30
Dividend Yield
3.24%
Does ED Have a Competitive Moat?
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🏰 Wide
Moat Trend
Stable
Moat Sources
2 Identified
The moat is highly durable due to the essential nature of its services, the prohibitive capital costs of replicating its infrastructure, and the regulatory framework that grants it exclusive operating rights. This effectively creates a natural monopoly.
Moat Erosion Risks
- •Significant and sustained adverse regulatory changes, particularly regarding rate-setting or environmental compliance costs.
- •Accelerated development of localized, distributed energy generation that significantly reduces reliance on central grid infrastructure (a very long-term and low-probability threat).
ED Competitive Moat Analysis
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ED Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral (Predominantly appeals to income-seeking investors, not typically a social media 'buzz' stock).
Institutional Sentiment
Neutral (Mixed analyst ratings; KeyBanc Underweight/Argus Outperform, target ranges $97-$118 reflecting stability rather than growth potential).
Insider Activity (Form 4)
No specific Form 4 filings reported for the last 90 days (Jan 21-Apr 21, 2026).
Options Flow
Normal options activity (no specific unusual options activity reported in research).
Earnings Intelligence
Next Earnings
2026-05-07
Surprise Probability
Medium
Historical Earnings Pattern
Typically exhibits modest stock price movements (low volatility) following earnings reports, with investor focus often on dividend policy and regulatory updates rather than significant beats or misses.
Key Metrics to Watch
Competitive Position
Top Competitor
NextEra Energy Inc (NEE)
Market Share Trend
Stable (operates as a regulated monopoly in its service territories).
Valuation vs Peers
Trading at a P/E (19.49) that is in line or slightly above some regulated utility peers, reflecting its defensive nature and dividend yield rather than superior growth prospects. NextEra Energy (NEE), for example, commands a higher multiple due to its significant renewable energy generation arm that offers better growth prospects.
Competitive Advantages
- •Regulated monopoly status in critical urban areas (NYC & Westchester)
- •Extensive, irreplaceable infrastructure network
- •Essential service provider with high barriers to entry
Market Intelligence
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What Could Drive ED Stock Higher?
Near-Term (0-6 months)
- •Q1 2026 Earnings report on 2026-05-07 (after market close)
- •Quarterly dividend payable on 2026-06-15
Medium-Term (6-18 months)
- •Continued investment in grid modernization and renewable energy infrastructure
- •Resolution of NYSPSC audit related to income tax accounting
Long-Term (18+ months)
- •Ongoing energy transition and decarbonization efforts within its service territory
- •Stable demand growth in its core regulated markets
Catalysts & Growth Drivers
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What's the Bull Case for ED?
- ✓
Any unexpected changes to dividend policy (increase or decrease).
- ✓
Major favorable or unfavorable rulings from the New York State Public Service Commission (NYSPSC).
- ✓
Significant shifts in long-term interest rates impacting utility valuations.
Bull Case Analysis
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How Consolidated Edison Inc Makes Money
Consolidated Edison is a regulated utility company that provides electricity, natural gas, and steam to millions of residential, commercial, and industrial customers primarily in New York City and Westchester County. The company operates as a regulated monopoly, meaning its rates and operations are overseen by state public service commissions. It generates revenue by delivering these essential energy services through its vast infrastructure network, with approved rates designed to cover operational costs and provide a regulated return on its capital investments. This stable, regulated framework ensures predictable cash flows, making it an income-oriented investment.
Read Full Business Model BreakdownFAQ
What is the DVR Score for Consolidated Edison Inc (ED)?
As of April 21, 2026, Consolidated Edison Inc has a DVR Score of 0.1 out of 10, placing it in the "Distressed" category. This score is generated by our AI-powered deep value analysis framework that evaluates growth potential, financial health, competitive moat, and risk factors.
What is the market capitalization of Consolidated Edison Inc?
Consolidated Edison Inc's market capitalization is approximately $40.3B..
What is the risk level for ED stock?
Our analysis rates Consolidated Edison Inc's overall risk as Conservative. This assessment considers execution risk, market risk, financial risk, competitive risk, and regulatory risk. For a full breakdown, see the risk analysis section above.
What is the P/E ratio of ED?
Consolidated Edison Inc currently has a price-to-earnings (P/E) ratio of 19.9. This is in line with broader market averages.
Does Consolidated Edison Inc pay a dividend?
Yes, Consolidated Edison Inc pays a dividend with a current yield of approximately 3.24%.
Is Consolidated Edison Inc's revenue growing?
Consolidated Edison Inc has reported revenue growth of 10.8%. The company is showing strong top-line momentum.
Is ED stock profitable?
Consolidated Edison Inc has a profit margin of 11.9%. The company is profitable but margins are modest.
How often is the ED DVR analysis updated?
Our AI-powered analysis of Consolidated Edison Inc is refreshed regularly to incorporate the latest financial data, market conditions, and news. The most recent update was on April 21, 2026.
Important Disclaimer – Not Financial Advice
Deep Value Reports is an independent research platform for educational and informational purposes only. We are not financial advisors, investment advisors, or licensed professionals. The analysis, scores, and information provided on this page for ED (Consolidated Edison Inc) should not be construed as personalized investment advice, a recommendation to buy or sell any security, or an offer to provide investment advisory services.
All investments involve risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research, consider your financial situation, and consult with a qualified financial advisor before making any investment decisions.