North American Utilities Valuing Total Return: Updated PE/TR Thoughts Point to ETR, XEL

Research evidence excerpt

North American Utilities Valuing Total Return: Updated PE/TR Thoughts Point to ETR, XEL

J P M O R G A N North America Equity Research

27 May 2026

North American Utilities

Valuing Total Return: Updated PE/TR Thoughts Point to

ETR, XEL

Following 1Q earnings and recent AGA meetings, we refresh our P/E to total return North American Utilities

ACanalysis where we examine how much the market will pay (P/E) for expected total Jeremy Tonet, CFA

shareholder return (Y+G). We affectionately refer to the (P/E)/TR ratio as PETeR, (1-212) 622-4915

or altogether (P/E)/(Y+G). Our framework utilizes a 2028 base year from which jeremy.b.tonet@jpmorgan.com

we compare the P/E to the sum of NTM yield and our expected two-year EPS Aidan C Kelly AC

CAGR into 2030. We view this framework as a tool to analyze how much the (1-212) 622-4912

market will pay relative to the total return profile, and which names screen aidan.x.kelly@jpmchase.com

attractive at current levels. For regulated utilities under coverage, we estimate the Eli Jossen, CFA AC

large cap median PETeR stands at 1.48x ex-California. We see those trading below (1-212) 622-4113

eli.jossen@jpmchase.com

these levels as likely offering either attractive value or possessing notable risk to

Diana Nilesearnings expectations). By contrast, those trading at higher ratios might deliver

(1-212) 622-3328

growth higher than expectations, or represent overvalued companies. Overall, we diana.niles@jpmorgan.com

believe ETR and AEE offer the most attractive proposition on this metric, J.P. Morgan Securities LLC

highlighting significantly above-peer growth more than compensating for a

somewhat lower dividend, alongside a relatively favorable regulatory and political

backdrop.

• ETR, AEE stand out among cleaner stories. ETR’s 1.36x PETeR ranks as