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CEG, Constellation Energy

Electric Utilities capital-intensive Regulated utilityCapital build-outCyclical

We operate the largest emissions-free generation fleet in the nation and are one of the largest competitive electric generation companies in the nation, as measured by owned and contracted MWs.

Calpine is the nation's largest generator of electricity from natural gas and geothermal resources, according to S&P Global Market Intelligence, with a strong footprint in Texas, California, and the Northeast regions of the U.S.

Latest annual: FY2025 10-K

CEG · Constellation Energy

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$22.7B

+19.5% YoY · 5% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $24.1B 5-yr avg $20.3B

Operating margin 20.6% 5-yr avg 8.9%

ROIC 7% 5-yr avg 9%

Owner-earnings margin 5% 5-yr avg −18%

Free cash flow margin 5% 5-yr avg −18%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Regulated utility. Returns are set by regulation on an approved rate base; the capital spending regulators approve becomes the growth, recovered through allowed rates. Capital build-out. Capital spending has surged to 13% of sales, today's earnings are charged less depreciation than tomorrow's will be. Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Operating margin has run about 2.3% through the cycle, a thin margin, where volume, cost discipline and the price it gets all bear on the result. The margin is cyclical, swinging between −2.0% and 23% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Capital spending runs about 10% of sales, below what it charges for depreciation, so the return earned on what it sinks into that plant weighs as much as the margin. Read this kind of business on rate base and the allowed return. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has sat near the cost of capital (median 8%). Owner earnings, the cash-based check, have been thin too. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2020–2025

realized figures from each filing · older years to the left

2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
							Income statement
$17.6B	$17.3B	$21.6B	$20.8B	$19.0B	$22.7B	$24.1B	RevenueRevenue
$256M	($346M)	$495M	$1.6B	$4.4B	$3.1B	$5.0B	Operating incomeOp. inc.
1.5%	−2.0%	2.3%	7.7%	22.9%	13.6%	20.6%	Operating marginOp. mgn
$589M	($205M)	($160M)	$1.6B	$3.7B	$2.3B	$3.8B	Net incomeNet inc.
30%	—	—	35%	17%	34%	31%	Effective tax rateTax rate
							Cash flow & returns
$584M	($1.3B)	($2.4B)	($5.3B)	($2.5B)	$4.2B	$4.6B	Operating cash flowOp. cash
$3.6B	$4.5B	$2.4B	$2.5B	$2.7B	$2.6B	$3.2B	DepreciationDeprec.
($3.6B)	($5.7B)	($4.6B)	($9.4B)	($8.9B)	($683M)	($2.4B)	Working capital & otherWC & other
$1.7B	$1.3B	$1.7B	$2.4B	$2.6B	$2.9B	$3.4B	CapexCapex
9.9%	7.7%	7.8%	11.6%	13.5%	13.0%	14.2%	Capex / revenueCapex/rev
($1.2B)	($2.7B)	($4.0B)	($7.7B)	($5.0B)	$1.3B	$1.1B	Owner earningsOwner earn.
−6.6%	−15.5%	−18.7%	−37.1%	−26.5%	5.7%	4.7%	Owner earnings marginOE mgn
($1.2B)	($2.7B)	($4.0B)	($7.7B)	($5.0B)	$1.3B	$1.1B	Free cash flowFCF
−6.6%	−15.5%	−18.7%	−37.1%	−26.5%	5.7%	4.7%	Free cash flow marginFCF mgn
—	$30M	$29M	$1.7B	$32M	$14M	$2.6B	AcquisitionsAcquis.
$0	$0	$185M	$366M	$444M	$486M	$519M	Dividends paidDiv. paid
—	$0	$0	$992M	$999M	$400M	—	BuybacksBuybacks
—	-1%	—	6%	19%	11%	7%	ROICROIC
4%	-2%	-1%	15%	28%	16%	11%	Return on equityROE
4%	−2%	−3%	12%	25%	13%	10%	Retained to equityRetained/eq
							Balance sheet
$226M	$504M	$422M	$368M	$3.0B	$3.6B	$800M	Cash & investmentsCash+inv
—	$1.7B	$2.6B	$1.9B	$3.7B	$4.3B	$4.4B	ReceivablesReceiv.
—	—	—	—	$1.6B	$1.7B	$2.6B	InventoryInvent.
—	$1.8B	$2.8B	$1.3B	$2.4B	$2.8B	$2.7B	Accounts payablePayables
—	($88M)	($243M)	$632M	$2.9B	$3.2B	$4.3B	Operating working capitalOper. WC
—	$8.0B	$9.4B	$8.3B	$10.8B	$12.1B	$18.0B	Current assetsCur. assets
—	$8.0B	$7.8B	$6.3B	$6.8B	$7.9B	$13.2B	Current liabilitiesCur. liab.
—	1.0×	1.2×	1.3×	1.6×	1.5×	1.4×	Current ratioCurr. ratio
—	—	$47M	$425M	$420M	$420M	$11.5B	GoodwillGoodwill
—	$48.1B	$46.9B	$50.8B	$52.9B	$57.2B	$96.9B	Total assetsAssets
—	$5.8B	$4.6B	$7.6B	$8.4B	$7.3B	$17.4B	Total debtDebt
—	$5.3B	$4.2B	$7.2B	$5.4B	$3.7B	$16.6B	Net debt / (cash)Net debt
0.8×	-1.2×	2.0×	3.7×	8.6×	6.0×	8.0×	Interest coverageInt. cov.
$14.7B	$11.2B	$11.0B	$10.9B	$13.2B	$14.5B	$33.5B	Shareholders’ equityEquity
							Per share
0K	0K	329M	324M	315M	314M	354M	Shares out (diluted)Shares
—	—	$65.57	$64.32	$60.20	$72.18	$68.07	Revenue / shareRev/sh
—	—	$-0.49	$5.01	$11.90	$7.39	$10.71	EPS (diluted)EPS
—	—	$-12.29	$-23.84	$-15.97	$4.10	$3.21	Owner earnings / shareOE/sh
—	—	$-12.29	$-23.84	$-15.97	$4.10	$3.21	Free cash flow / shareFCF/sh
—	—	$0.56	$1.13	$1.41	$1.55	$1.47	Dividends / shareDiv/sh
—	—	$5.13	$7.48	$8.14	$9.39	$9.66	Cap. spending / shareCapex/sh
—	—	$33.49	$33.72	$41.80	$46.23	$94.58	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	5-yr	5-yr
Revenue / share	+3.3%/yr (3-yr)	+3.3%/yr (3-yr)
Dividends / share	+40.1%/yr (3-yr)	+40.1%/yr (3-yr)
Capital spending / share	+22.3%/yr (3-yr)	+22.3%/yr (3-yr)
Book value / share	+11.3%/yr (3-yr)	+11.3%/yr (3-yr)

The record, charted

FY2020–2025

Each measure over its full record; the current point and the worst year marked.

Share count

314Mpeak FY2022

ROIC

11%low FY2021

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$1.3Bowner earningsvs.$2.3Bnet incomelow FY2023

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported $2.3B of profit but $1.3B of owner earnings: $1.0B less than the profit line, taken out by capital spending and the timing of cash.

Reported net income$2.3B

Owner earnings$1.3B · 6% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$2.3B	$3.7B	$1.6B	($160M)	($205M)
Depreciation & amortizationnon-cash charge added back	+$2.6B	+$2.7B	+$2.5B	+$2.4B	+$4.5B
Working capital & othertiming of cash in and out, other non-cash items	−$683M	−$8.9B	−$9.4B	−$4.6B	−$5.7B
Cash from operations	$4.2B	($2.5B)	($5.3B)	($2.4B)	($1.3B)
Capital expenditurecash put back in to keep running and to grow	−$2.9B	−$2.6B	−$2.4B	−$1.7B	−$1.3B
Owner earnings	$1.3B	($5.0B)	($7.7B)	($4.0B)	($2.7B)
Owner-earnings marginowner earnings ÷ revenue	6%	-27%	-37%	-19%	-15%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position .

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 6.0×

Comfortable

Operating income $3.1B ÷ interest expense $511M

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? $3.7B · 1.2× operating profit

Modest net debt

Cash $3.6B − debt $7.3B

What this means
Netting $3.6B of cash and short-term investments against $7.3B of debt leaves $3.7B owed, about 1.2× a year's operating profit (2.4× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? —

Not enough data

What this means
The filing data didn't include the inputs for this check.

Is it a good business?

Return on invested capital 6%

Below average through the cycle

4-yr median, range -1%–19%; 11% latest = NOPAT $2.0B ÷ invested capital $18.2B

Industry peers: median 6%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 4 years (it ran 11% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 6%

Positive this year, negative across the cycle

latest $1.3B = operating cash $4.2B − maintenance capex $2.9B (positive this year), after an earlier loss stretch (6-yr median -19%)

Industry peers: median 17%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 6% of revenue this year, a -19% median across 6 years.
Are earnings backed by cash? 1.83×

Cash-backed

Cash from ops $4.2B ÷ net income $2.3B

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 69%

Returns about half

Dividends + buybacks $886M ÷ Owner Earnings $1.3B

What this means
Of $1.3B Owner Earnings, $886M (69%) went back to shareholders, $486M dividends, $400M buybacks. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 1.13×

Maintaining

Capex $2.9B ÷ depreciation $2.6B

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $22.7B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Near

Current ratio ≥ 2× · 1.53×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $7.3B vs $4.2B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (6-yr record) · 2 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · 4 of 6 yrs

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +3333%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $7.10/share (latest year $6.42), the averaged base the calculator's gate runs on, and book value is $40.19/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2020–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 4 of 6

What this means
Lost money in 2 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 1 of 5 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 1% → 15% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about 1% early to 15% lately, median 2% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2021 · −2.0% op. margin

What this means
Operations went underwater in 2021, understand why before trusting the good years.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.
How management talks about it Promotional

What this means
The record is compounding, but the filing leans on a promoter’s vocabulary rather than the per-share, return-on-capital terms an owner uses. The results back the talk here; the register is still worth noting.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Framed as a capability

The filing positions AI as something the company uses, not something it fears.

“Further, advancements in AI and other technology could lead to reduced barriers of entry resulting in increased competition from new market participants.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$18.0B

Cash & short-term investments$800M
Receivables$4.4B
Inventory$2.6B
Other current assets$10.2B

Current liabilities$13.2B

Debt due within a year$370M
Accounts payable$2.7B
Other current liabilities$10.1B

Current ratio1.36×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.17×stricter: inventory excluded

Cash ratio0.06×strictest: cash alone against what's due

Working capital$4.8Bthe cushion left after near-term bills

Debt due this year vs. cash$370M due · $800M cash covered by cash on hand, no refinancing forced · both figures from the Mar 31, 2026 balance sheet

Revenue, latest quarter vs. a year ago+63.8%the freshest read on whether the business is still growing

Current ratio, recent quarters1.4× → 1.4×

Deeper floors

Tangible book value$21.8Bequity stripped of goodwill & intangibles

Net current asset value($45.1B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$17.9B$505M of it operating leases

From the company's latest filing.

Debt maturity

the debt note, SEC EDGAR →

Not how much it owes, but when it falls due, and against what. The ladder the company files, beside cash on hand and a year's owner earnings.

'26$92M

'27$666M

'28$828M

'29$157M

'30$99M

Bars scaled to the largest single year.

Due in the next 12 months$92Mthe first rung: what must be repaid or rolled over within the year

Within two years$758Mthe near wall, the part most exposed to today’s credit conditions

Biggest single year$828Min 2028the lumpiest maturity, where a refinancing, if needed, is largest

Due over the next five years$1.8Bthe near slice; the balance sheet carries $7.3B of debt in all

Against what the business has and earns

Cash & short-term investments, Mar 31, 2026$800M

One year of owner earnings (FY2025)$1.3B

Together, against $92M due next year22.7×

Cash on hand as of Mar 31, 2026 plus a year’s owner earnings comes to $2.1B against the $92M due in the twelve months after the Dec 31, 2025 schedule: 23 times it.

Maturity schedule extracted from the company’s Dec 31, 2025 annual report and reconciled to the balance-sheet debt.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2022	Mr. Dominguez	$10.4M	$23.6M	($4.0B)
2022	Mr. Dominguez	$10.4M	$23.6M	($4.0B)
2023	Mr. Dominguez	$15.2M	$30.9M	($7.7B)
2023	Mr. Dominguez	$15.2M	$30.9M	($7.7B)
2024	Mr. Dominguez	$16.2M	$83.5M	($5.0B)
2024	Mr. Dominguez	$16.2M	$83.5M	($5.0B)
2025	Mr. Dominguez	$17.1M	$78.8M	$1.3B
2025	Mr. Dominguez	$17.1M	$78.8M	$1.3B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Inverting the record

Invert: instead of why Constellation Energy is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2020–2025.

1 of the 3 tests turned up something to look into; the other 2 came back clean.

Look hereDid reported profit become cash?-0.84×
Across the record the business reported $7.9B of net income but generated ($6.6B) of operating cash, a -0.84-to-one conversion. Profit that does not turn into cash over many years is the classic mark of earnings that are softer than they look. Ask where the gap sits, receivables, inventory, or costs being capitalized rather than expensed.

And these came back clean

Is it less profitable than it was?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Acquisitions as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Electric Utilities

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
NRGNRG Energy	$30.3B	24%	7.6%	13%	9%
NEENextEra Energy Inc.	$27.4B	—	28.2%	6%	—
CEGConstellation Energy	$22.7B	—	5.0%	8%	-17%
AEPAmerican Electric Power Company Inc.	$21.7B	—	19.2%	6%	26%
EIXEdison International	$19.3B	—	13.1%	4%	7%
VSTVistra	$17.6B	—	10.8%	7%	17%
DDominion Energy Inc.	$16.5B	—	23.1%	4%	21%
DTBDTE Energy Co	$15.8B	—	13.6%	6%	—
Group median	—	—	13.3%	6%	13%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Constellation Energy has delivered.

Today’s price $

Base Normalize · through-cycle (($3.8B)) Net of stock comp Steady-state · maintenance capex ($1.6B)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth, delivered—

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $1.1B on 361M shares outstanding, per the 10-Q cover, as of 2026-04-30; net debt $16.6B. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. Capex ($3.4B) runs well above depreciation ($3.2B), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $1.6B, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh CEG against another business →

The owners of CEG: the meeting and the votes →

Cite: Owner Scorecard, "Constellation Energy (CEG), the owner's record," https://ownerscorecard.com/c/CEG, data as of 2026-07-09.

Manual order: ← CECO its page in the Manual CELH →

Industry order: ← BKH the Electric Utilities chapter CEPU →