Exelon Corporation (EXC): A Rising Star in the Energy Sector in 2025

Exelon Corporation (EXC) has been making significant strides in the energy sector, with its strategic focus on transmission and delivery-only services paying off in 2025. The company's commitment to grid modernization, reliability, and customer satisfaction has positioned it as a leader in the energy transformation, driving strong financial performance and market position.

Exelon's growth and performance in 2025 can be attributed to several key factors. First, the company's investment in capital expenditures (CapEx) has been instrumental in driving rate base growth and earnings growth. Exelon plans to invest $38 billion in capital expenditures over the next four years, a 10% increase from its previous plan. This investment is aimed at supporting customer needs and grid reliability, resulting in expected rate base growth of 7.4% and operating EPS compounded annual growth of 5-7% from 2024 to 2028. This trend is sustainable in the long term as it aligns with the company's commitment to grid modernization and reliability.



Second, regulatory approvals and cost recovery mechanisms have played a significant role in Exelon's rate base growth and earnings growth in 2025. Close to 90% of Exelon's rate base is now covered by established mechanisms outlining cost recovery through 2026 or 2027. This includes final orders issued in the fourth quarter for Pepco's multi-year rate plan in DC, PECO's electric and gas rate cases, and ComEd's Refiled Grid Plan. These regulatory approvals and cost recovery mechanisms allow Exelon to recover costs associated with investments in infrastructure and grid reliability, which in turn drives rate base growth and earnings growth.

Third, Exelon's dividend payout has been a key factor in its strong performance in 2025. The company declared a quarterly dividend of $0.40 per share for the first quarter of 2025, implying an expected total 2025 dividend that represents an approximate 60% payout of Adjusted (non-GAAP) operating earnings per share. This trend is sustainable as long as the company maintains its dividend payout ratio and generates sufficient earnings to support it.

Exelon's strategic focus on transmission and delivery-only services has also allowed it to maintain a balanced funding strategy. The company plans to include $1.4 billion of additional equity to fund approximately 40% of $3.5 billion of incremental capital expenditures, in line with a balanced funding strategy. This approach ensures that the company's financial performance remains strong and sustainable in the long term.

In conclusion, Exelon Corporation (EXC) has been gaining in 2025 due to its strategic focus on transmission and delivery-only services, investment in capital expenditures, regulatory approvals and cost recovery mechanisms, and dividend payout. The company's commitment to grid modernization, reliability, and customer satisfaction has positioned it as a leader in the energy transformation, driving strong financial performance and market position. As Exelon continues to execute on its strategic plan, investors can expect the company to maintain its momentum in the long term.