Exelon CorporationEXC

Morningstar Rating

Stock Research and Analysis

by Travis Miller

In an era of concerns about global warming and rising fossil fuel prices, Exelon maintains an enviable position as the largest nuclear plant operator in the United States. Its ability to produce low-cost, carbon-free electricity should produce substantial, Read more

Bulls Say

Ultra-low-cost nuclear power plants that run nearly 100% of the time translate into big-time profits for the generation unit.

Exelon's 11 nuclear stations produced 17% of the nation's nuclear power in 2009 and 4% of the nation's electricity.

Expiring price caps in Pennsylvania should yield more than $1 billion in incremental margin in 2011.

If the U.S. institutes much-debated carbon restrictions, Exelon's carbon-free nuclear plants should yield about $1 billion in additional gross margin. Read more

Bears Say

Exelon's performance depends on highly volatile power prices that fluctuate on the basis of natural gas prices, coal prices and regional electricity demand.

Struggles in the company's regulated units continue to dilute the generation unit's value.

As of 2009, Exelon had written off nearly half of ComEd's $4.9 billion of goodwill associated with the 2000 merger.

A surge of renewable energy development in wind or solar in the Midwest could hurt margins for Exelon's nuclear plants. Read more

Strategy

To protect its highly profitable niche in power generation, management continues to push for market deregulation and environmental restrictions such as carbon caps. Its latest plan to add up to 1,500 Read more

Management

Overall, we think Exelon's management is one of the best in the utility industry. Chairman, CEO, and president John Rowe starts his 13th year with Exelon in 2010 and is one of the nation's leading cheerleaders for nuclear power. In September 2008, Christopher Read more

Profile

Exelon is a holding company with regulated and unregulated divisions. Its regulated division, comprising Commonwealth Edison of Illinois and PECO of Pennsylvania, distributes Read more

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