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 biggest risk for ED is a combination of rising interest rates increasing financing costs for its large capital expenditure programs and adverse regulatory decisions that limit its ability to recover these costs or earn a fair return on its investments, potentially impacting dividend growth and share price stability.
Risk Matrix
Overall
Conservative
Financial
Medium
Market
Low
Competitive
Low
Execution
Low
Regulatory
Medium
Red Flags
- ⚠
Ongoing share dilution through ATM program and forward sales, weighing on per-share metrics.
- ⚠
Adjusted EPS decline in Q1 2026 despite revenue growth, indicating margin pressure.
- ⚠
Reliance on regulated returns means growth is capped by regulatory approval, not market opportunity.
Upcoming Risk Events
- 📅
Unfavorable rate case outcomes (e.g., lower approved returns)
- 📅
Significant interest rate increases impacting financing costs
- 📅
Unexpected operational outages or infrastructure failures
When to Reconsider
- 🚪
Exit if the dividend payout ratio becomes unsustainable (e.g., above 90% of adjusted EPS).
- 🚪
Sell if there's a significant downgrade in the company's credit rating, increasing borrowing costs.
- 🚪
Exit if the regulatory environment in New York becomes overtly hostile to utilities, severely limiting rate increases.
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Investment Thesis
Consolidated Edison is a mature, regulated utility offering stable, predictable earnings and a reliable dividend, making it suitable for income-focused investors seeking defensive exposure. It lacks the scalability, disruptive potential, and hyper-growth drivers necessary for a 10x return within a 3-5 year horizon, making it unsuitable for aggressive growth portfolios.
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ED Price Targets & Strategy
12-Month Target
$108.00
Bull Case
$115.00
Bear Case
$98.00
Valuation Basis
Based on a 18x forward P/E multiple applied to a conservative estimated FY26 EPS of $6.00.
Entry Strategy
For income investors, consider buying on dips below $100 (near typical support levels and attractive yield entry). Growth investors should avoid.
Exit Strategy
Income investors may hold indefinitely for dividend. Growth investors should not enter. Consider selling if yield compresses significantly or if regulatory environment deteriorates.
Portfolio Allocation
0% for aggressive growth portfolios; 3-5% for conservative income-focused portfolios.
Price Targets & Strategy
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Is ED Financially Healthy?
Valuation
P/E Ratio
19.20
Forward P/E
17.22
EV/EBITDA
10.90
PEG Ratio
2.72
Price/Book
1.52
Price/Sales
2.16
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
$5.65B
Other
Beta (Volatility)
0.29
Dividend Yield
3.31%
Does ED Have a Competitive Moat?
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🏰 Wide
Moat Trend
Stable
Moat Sources
3 Identified
Con Edison's moat is extremely durable due to its essential service in a densely populated, economically vital region, protected by robust regulatory frameworks. Building a competing utility network is prohibitively expensive and legally challenging, ensuring its dominant position for decades.
Moat Erosion Risks
- •Increased regulatory scrutiny leading to lower allowed returns on equity
- •Policy shifts favoring municipalization or significantly decentralizing power generation
- •Climate change mitigation costs becoming unrecoverable from ratepayers
ED Competitive Moat Analysis
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ED Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral (primarily driven by income investors, not growth speculation).
Institutional Sentiment
Neutral to Negative (previous analysis cited institutional stake reduction, no new consensus found but generally holds for yield, not growth).
Insider Activity (Form 4)
No specific Form 4 insider transactions (buy/sell) found in the provided research, suggesting normal activity or no recent material changes.
Options Flow
Normal options activity (reflecting a stable utility stock, not speculative growth).
Earnings Intelligence
Next Earnings
Estimated early-August 2026 (for Q2 2026)
Surprise Probability
Medium (historically stable, but regulated revenues can still vary slightly)
Historical Earnings Pattern
Typically exhibits moderate price movements on earnings reports, driven by dividend announcements, rate case updates, and capital spending plans rather than significant revenue beats/misses.
Key Metrics to Watch
Competitive Position
Top Competitor
NEE (NextEra Energy) - Leads in renewable energy development and has a strong growth profile beyond traditional utilities, though it is not a direct peer due to its scale and strategy.
Market Share Trend
Stable (as a regulated monopoly within its service territories, market share is protected by regulation).
Valuation vs Peers
Historically, ED trades at a slight premium P/E to the regulated utility sector due to its stable New York market, though the current P/E is not explicitly provided in the research for direct comparison.
Competitive Advantages
- •Regulated monopoly status in critical urban areas (NYC, Westchester)
- •Efficient Scale: Extensive infrastructure network with high barriers to entry
- •Strong brand recognition and long operating history
Market Intelligence
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What Could Drive ED Stock Higher?
Near-Term (0-6 months)
- •Q2 2026 Earnings Report (Estimated early August 2026)
- •Rate case approvals and outcomes in New York jurisdiction
Medium-Term (6-18 months)
- •Infrastructure upgrade project completions and new asset additions to rate base
- •Dividend increase announcements (typical annual event)
Long-Term (18+ months)
- •Further investment in renewable energy transmission/distribution infrastructure
- •Adaptation to stricter climate policies in New York State
Catalysts & Growth Drivers
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What's the Bull Case for ED?
- ✓
Acceleration in dividend growth (positive signal for income investors)
- ✓
Significant changes in New York regulatory policy (could be positive or negative)
- ✓
Persistent adjusted EPS declines (negative for total return)
Bull Case Analysis
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How Consolidated Edison Inc Makes Money
Consolidated Edison Inc. is a regulated utility company that provides electricity, natural gas, and steam to approximately 3.5 million customers in New York City and Westchester County, New York. It primarily makes money by investing in and maintaining its vast transmission and distribution infrastructure (power lines, gas pipes, steam mains) and earning a regulated rate of return on these assets, as approved by state utility commissions. This model ensures stable revenue streams and predictable earnings, as its costs and profits are largely covered by customer rates.
Read Full Business Model BreakdownFAQ
What is the DVR Score for Consolidated Edison Inc (ED)?
As of May 17, 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 $38.8B..
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 19.2. 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 3.31%.
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 May 17, 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.