Is Xcel Energy (XEL) Undervalued As Earnings Strength And Battery Project Interest Build?
Xcel Energy (XEL) is in focus after reaffirming its 2026 earnings guidance and reporting second quarter results, alongside fresh attention on its long duration battery project with Form Energy and Google.
See our latest analysis for Xcel Energy.
The reaffirmed 2026 earnings guidance and stronger second quarter earnings per share seem to have supported Xcel Energy’s momentum. This is reflected in a 1-day share price return of 1.21% and a year-to-date share price return of 5.25%, alongside a 1-year total shareholder return of 11.11% that contributes to a 48.97% total shareholder return over three years.
If grid and storage projects like Xcel Energy’s battery partnership have caught your attention, it can be useful to see what else is shaping the power sector, including 36 power grid technology and infrastructure stocks
With Xcel Energy shares up after the earnings reaffirmation and trading at $78.60, the real question is whether that recent move already reflects the story or if patience could still offer a better entry.
Most Popular Narrative: 14% Undervalued
The most followed narrative puts Xcel Energy’s fair value at $91.39, above the recent $78.60 close, and builds that gap on long term grid and clean energy investment plans.
Policy-driven decarbonization and climate measures are accelerating demand for wind, solar, and storage projects, with Xcel's aggressive clean energy buildout (aiming for over 80% carbon-free generation by 2030) supporting long-term regulated asset base expansion and sustained earnings growth.
Want to see what sits behind that valuation gap? The narrative leans on revenue growth, improved margins, and a higher future earnings multiple than many utilities typically carry.
Result: Fair Value of $91.39 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, there is still real execution risk for Xcel Energy if wildfire liabilities escalate or if regulators push back on the large capital and rate plan.
Find out about the key risks to this Xcel Energy narrative.
Another View on Xcel Energy’s Value
The analyst narrative points to Xcel Energy as about 14% undervalued at a fair value of $91.39. The SWS DCF model tells a different story. On that view, the current $78.60 price sits above an estimated value of $72.08, which implies less of a margin for error. Which lens do you find more convincing?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Xcel Energy for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 49 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
Given this mix of potential rewards and risks around Xcel Energy, it makes sense to look at the full picture yourself and move quickly while the data is fresh. To help you do that, take a closer look at the 2 key rewards and 2 important warning signs.
Looking for more investment ideas beyond Xcel Energy?
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- Hunt for mispriced opportunities using the 49 high quality undervalued stocks and compare how their fundamentals stack up against Xcel Energy.
- Prioritise capital protection by scanning companies in the 85 resilient stocks with low risk scores so you are not overlooking steadier options while focusing on Xcel Energy.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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