Breaking Down Consolidated Edison, Inc. (ED) Financial Health: Key Insights for Investors

You're looking for a clear, no-nonsense assessment of Consolidated Edison, Inc. (ED) because in a choppy market, you need to know if your bond proxy still holds up. The short answer is yes, but the long-term capital demands are defintely the story here. Management reaffirmed its 2025 adjusted earnings per share (EPS) guidance in the range of $5.50 to $5.70, which is a solid, predictable utility performance, and the company's trailing twelve months net income as of September 2025 hit $2.035 billion, showing a 10.36% year-over-year lift. That stability is why they can boast a 51-year streak of dividend increases, currently paying an annual dividend of $3.40 per share. But here's the trade-off: to support the clean energy transition and grid resiliency, ED is projecting nearly $72 billion in capital investments over the next 10 years-a colossal figure that maps directly to their future rate base growth, but also signals a persistent need for financing. We need to break down how they plan to fund that CapEx and what it means for the sustainability of that payout, so let's dive into the core risks and opportunities now.

Revenue Analysis

You need to know where Consolidated Edison, Inc. (ED)'s cash engine is pulling from, especially with the utility sector's shift toward infrastructure investment. The takeaway is clear: the regulated utility segments-Electric and Gas-remain the defintely dominant and most predictable drivers of revenue, posting strong growth in 2025.

For the trailing twelve months (TTM) ending September 30, 2025, Consolidated Edison, Inc.'s total revenue hit approximately $16.59 billion. This represents a robust year-over-year increase of about 10.39%, which significantly outpaces the sector average. This growth isn't about volume surges; it's primarily driven by realized rate base increases-the approved returns on the massive capital expenditures (capex) the company is making to modernize and harden its system.

Here's the quick math on where that money originates, based on the Q1 2025 results, which set the tone for the year:

• Electric Segment: Generated $2.90 billion. This is the largest single contributor, serving New York City and Westchester County.
• Gas Segment: Contributed $1.54 billion. This includes both distribution and transmission services.
• Steam Segment: Added $354 million. A unique, high-density revenue stream in Manhattan.

The core business is a regulated monopoly (or near-monopoly), so revenue stability is high. What this segment breakdown hides is the strategic pivot. The company completed the sale of its Clean Energy Businesses in 2023, which was a significant change. While that clean energy segment was a growth area, its sale has simplified the revenue profile, making Consolidated Edison, Inc. a purer-play regulated utility focused on its New York rate base and infrastructure upgrades. This focus is what drives the predictable revenue and earnings per share (EPS) guidance, which management narrowed to a range of $5.60 to $5.70 per share for the full fiscal year 2025.

The revenue growth is a direct result of capital investment being converted into the rate base. For example, the plan to complete 14 new substations and associated transmission work by 2030 directly supports future revenue increases through regulatory approval. Mission Statement, Vision, & Core Values of Consolidated Edison, Inc. (ED).

To be fair, the utility model means revenue is less about market competition and more about regulatory timing. You can see this stability in the historical trend:

The dip in 2023 was a blip, and the 2025 TTM figure shows a strong return to growth, driven by rate adjustments and the regulated asset base expansion. Your action is to track the regulatory approvals for the next round of rate increases, as that's the real lever for future revenue.

Profitability Metrics

You want to know if Consolidated Edison, Inc. (ED) is turning its revenue into real profit, and the short answer is yes, but with a utility-specific twist. The company's profitability is stable and generally healthy, though its net margin is lagging the broader sector's recent surge.

For the most recent Trailing Twelve Months (TTM) data, Consolidated Edison, Inc. shows a Gross Profit Margin of 60.70%, an Operating Profit Margin of 17.65%, and a Net Profit Margin of 11.98%. This translates to a massive TTM Gross Profit of $12.614 billion through September 30, 2025, reflecting the high initial markup typical of a regulated utility. The first nine months of 2025 alone saw net income for common stock reach $1,726 million. That's a solid, predictable cash flow machine.

Margin Trends and Operational Efficiency

Looking at the trend, Consolidated Edison, Inc. has shown a clear improvement in net profitability over the last few years. The Net Profit Margin has moved up from 8.99% in 2021 to the current 11.98% TTM, which is defintely a positive sign of effective rate-case management and cost control. The operational efficiency picture, however, is where you see the utility business model at work.

• Gross Margin Trends: The consistently high gross margin (revenue minus direct costs) above 60% shows strong pricing power, which is expected in a regulated monopoly.
• Operating Cost Management: The significant drop from a 60.70% Gross Margin to a 17.65% Operating Margin highlights the high fixed costs-like depreciation and administrative expenses-needed to run and maintain the massive infrastructure of a New York-based utility.
• Net Income Driver: The jump from the Operating Margin to the Net Margin (profit after all expenses, interest, and taxes) is relatively small, meaning the company's interest expense and taxes are managed well, a key factor for a debt-heavy utility.

Here's the quick math on the sector comparison:

To be fair, Consolidated Edison, Inc.'s TTM Net Profit Margin of 11.98% is actually quite strong when compared to the sector's historical TTM average of 10.88% from a few years ago. But the broader US Utilities sector has seen its Net Profit Margin surge to 17.2% in Q3 2025, which is notably higher than Consolidated Edison, Inc.'s current figure. This means that while Consolidated Edison, Inc. is profitable, many of its peers are currently turning a higher percentage of their revenue into net income, likely due to more favorable regulatory environments or a greater mix of high-margin, unregulated businesses.

The company's reaffirmed 2025 adjusted earnings per share (EPS) guidance of $5.60 to $5.70 per share, however, shows management is confident in delivering predictable, regulated returns. For a deeper look at the institutional money behind this stability, you should check out Exploring Consolidated Edison, Inc. (ED) Investor Profile: Who's Buying and Why?

Your next step should be to analyze their capital expenditure (CapEx) plan against this profitability. If the CapEx investments are driving future rate base growth, the lower current margin is simply the cost of securing higher, regulated profits down the line.

Debt vs. Equity Structure

You're looking at Consolidated Edison, Inc. (ED)'s capital structure, and the story is typical for a capital-intensive utility: growth is heavily financed by debt, but the balance is managed well within industry norms. The company's reliance on debt-a necessary evil for infrastructure investment-is clearly visible, but it's not a red flag in this sector.

As of the third quarter of 2025, Consolidated Edison, Inc. (ED) carried a significant debt load, which is expected for a regulated utility that must continuously invest in its grid and infrastructure. The total debt is heavily weighted toward long-term obligations, a smart move for financing assets that last decades.

• Short-Term Debt (Sep. 2025): $1.372 billion
• Long-Term Debt (Sep. 2025): $25.303 billion
• Total Stockholders' Equity (Sep. 2025): $24.168 billion

Debt-to-Equity: How ED Stacks Up

The Debt-to-Equity (D/E) ratio is your quick measure of financial leverage-how much debt the company uses versus shareholder funding (equity) to finance its assets. For Consolidated Edison, Inc. (ED), the D/E ratio as of September 2025 stood at approximately 1.10.

Here's the quick math: total debt of roughly $26.675 billion divided by equity of $24.168 billion gives you that 1.10. This means for every dollar of equity, the company uses about $1.10 of debt. To be fair, this is a very healthy position for a utility. The average D/E ratio for the Electric Utilities sub-industry was higher, around 1.582, as of early 2025. Consolidated Edison, Inc. (ED) is leveraging its capital structure less aggressively than many of its peers, which is a sign of financial stability.

Recent Financing and Credit Strength

The company is defintely leaning on the debt markets to fund its massive capital expenditure (CapEx) plan. Just in November 2025, a subsidiary, Consolidated Edison Company of New York, Inc., announced a debt offering of $900 million in 5.75% Debentures, Series 2025 A, due 2055. This new long-term debt is crucial for funding ongoing grid modernization and clean energy initiatives, especially as the U.S. electric power sector faces over $1.4 trillion in capital needs through 2030.

The market views this financing strategy as manageable. S&P Global Ratings affirmed an 'A-' credit rating for Consolidated Edison, Inc. (ED) and its subsidiaries in November 2025, maintaining a stable outlook. This investment-grade rating is vital; it keeps the cost of borrowing low, which ultimately benefits both the company and its ratepayers. The stable outlook reflects the expectation that the company will continue to fund its elevated capital spending in a balanced way, keeping its funds from operations (FFO) to debt ratio within the 16%-18% range.

The balance is clear: Consolidated Edison, Inc. (ED) uses debt to fund its regulated, predictable growth-a classic utility model-and its strong credit rating confirms the market's confidence in its ability to service that debt. You can find more details on the operational side of this balance in Breaking Down Consolidated Edison, Inc. (ED) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You're looking for a clear signal on whether Consolidated Edison, Inc. (ED) can cover its near-term bills, and the 2025 data gives us a precise, if tight, answer. The company's liquidity position is adequate for a regulated utility, not flush, but defintely stable enough to meet obligations.

As of November 2025, Consolidated Edison, Inc.'s Current Ratio stands at 1.10, and its Quick Ratio is 1.01. Here's the quick math: a Current Ratio of 1.10 means the company has $1.10 in current assets for every dollar of current liabilities. The Quick Ratio, which strips out less-liquid inventory, is just above the critical 1.0 mark at 1.01, which is right in line with the industry median of 1.005. This is a utility, not a tech startup; they don't need a massive cash hoard, but they do need reliable access to capital.

Working capital trends show a tight, but manageable, situation. The positive ratios mean working capital (current assets minus current liabilities) is positive, but slim. A key driver for this stability was the strong operational performance earlier in the year. The first quarter of 2025 saw a remarkable +67.63% surge in net cash from operating activities compared to the prior fiscal year, suggesting favorable movements in managing receivables and payables.

The real story for Consolidated Edison, Inc. is in the cash flow statement, where the sheer scale of capital expenditure (CapEx) dictates their financing strategy.

• Operating Cash Flow (OCF): The Trailing Twelve Months (TTM) OCF ending September 2025 was a robust $4,630 million. This is the core strength-a massive, regulated stream of cash from operations.
• Investing Cash Flow (ICF): The TTM Capital Expenditures were substantial at -$4,698 million. This heavy investment is standard for utilities modernizing infrastructure, but it's the reason free cash flow is often negative.
• Free Cash Flow (FCF): Because CapEx nearly matches OCF, the resulting FCF is tight. For context, FCF was -$1.16 billion in the full fiscal year 2024. The TTM figure ending September 2025, while not explicitly stated, shows a dramatic improvement, nearly breaking even, which is a major positive shift.

So, where does the cash come from to cover the gap and pay dividends? Financing. The company's liquidity strength is its ability to access the capital markets, which it is actively doing in 2025. Consolidated Edison, Inc. plans to issue up to $1,750 million of long-term debt and up to $1,350 million of common equity during the year to fund its capital requirements. Just this November 2025, they sold $900 million in debentures to support long-term goals, which shows this financing pipeline is wide open. The dividend, which was about $1.10 billion in 2024, is supported by the stable OCF, but the growth investments require external funding.

Here is a snapshot of the cash flow dynamics that drive the financing decisions:

What this estimate hides is the reliance on financing to bridge the gap between OCF and the massive CapEx program. The liquidity position is not a concern for a utility with this credit profile, but it is entirely dependent on continuous and successful capital market access. For a deeper dive into the valuation and strategy, you can read the full post: Breaking Down Consolidated Edison, Inc. (ED) Financial Health: Key Insights for Investors.

Valuation Analysis

You're looking at Consolidated Edison, Inc. (ED) and wondering if the current price reflects its true value. Based on the utility sector's typical metrics and the company's 2025 performance, the stock is trading in a range that suggests it is neither deeply discounted nor wildly overvalued. It's a classic utility play: stable, income-focused, and priced for minimal surprise.

The core valuation ratios tell a straightforward story. Consolidated Edison, Inc. (ED)'s trailing twelve-month (TTM) Price-to-Earnings (P/E) ratio currently sits around 18.11x. This is slightly below the broader Utilities sector average of 19.76x, which suggests a modest discount relative to peers. The forward P/E, based on the 2025 consensus Earnings Per Share (EPS) estimate of approximately $5.79, is also in a similar range. The Price-to-Book (P/B) ratio, a key metric for asset-heavy utilities, is about 1.52x, indicating the market is paying a reasonable premium over the company's net asset value.

• P/E Ratio (TTM): 18.11x
• P/B Ratio: 1.52x
• EV/EBITDA Ratio: 10.76x

When you look at Enterprise Value-to-EBITDA (EV/EBITDA), which accounts for debt-a major factor for a capital-intensive utility-Consolidated Edison, Inc. (ED) is trading at about 10.76x. This is right in the middle of where you'd expect a regulated utility to be. The current valuation multiples are defintely consistent with a mature, low-growth business model.

The stock price trend over the last 12 months shows the volatility inherent even in regulated businesses. The 52-week trading range has been between a low of approximately $87.28 and a high of $114.87. The stock hit its all-time high of $113.30 in April 2025, but has since settled, trading around $104.05 as of mid-November 2025. This performance represents a modest capital gain of about 1.70% over the past year, meaning total return is mostly driven by the dividend.

Speaking of income, the dividend profile remains robust. Consolidated Edison, Inc. (ED) is a Dividend Aristocrat, having increased its dividend for 51 consecutive years. The forward dividend yield is an attractive 3.37%, with an annual dividend of $3.40 per share. Crucially, the dividend payout ratio is manageable, sitting at around 59.28% of earnings, which confirms the dividend is well-covered and sustainable for the near-term.

Here's the quick math on the analyst view: the consensus rating from a pool of analysts is generally a 'Hold' or 'Neutral.' The average 12-month price target is clustered between $104.17 and $104.86, which is essentially flat from the current stock price. This suggests that most analysts see the stock as fairly valued and priced for its expected earnings growth.

The key takeaway is that Consolidated Edison, Inc. (ED) is priced for stability, not explosive growth. The valuation multiples are in line with its peer group, and the analyst consensus confirms the stock is fairly valued at its current price. If you want a deep dive into who is buying this stock, you should be Exploring Consolidated Edison, Inc. (ED) Investor Profile: Who's Buying and Why?

Risk Factors

You're investing in a regulated utility like Consolidated Edison, Inc. (ED) for stability, but even this sector is facing significant headwinds in 2025. The core risk isn't just operational-it's the political and financial tension between New York's ambitious clean energy goals and the relentless pressure on customer affordability. This is a tightrope walk for management.

Regulatory and Political Headwinds

The biggest near-term risk for Consolidated Edison, Inc. is regulatory uncertainty, specifically from the New York State Public Service Commission (NYSPSC). Your ability to earn a reasonable return on equity (ROE) and fund massive capital expenditures is dictated by these rate cases. For instance, the NYSPSC capped the allowed ROE at 10.1%, which is below the 10.5% the company requested, signaling a tightening of regulatory oversight. This regulatory pushback forced a major recalibration of the company's proposed rate hike, reportedly slashing a requested increase by $1.3 billion for electricity and $395 million for gas, directly impacting revenue recovery. This is a clear example of regulators prioritizing ratepayer protection over utility returns.

The affordability dilemma is defintely a core concern now. The company faced sharp criticism after 88,000 households were disconnected in the first half of 2025. This social and political pressure creates a volatile environment for future rate approvals, even for necessary infrastructure investments. The company is trying to mitigate this by expanding its Energy Affordability Program (EAP) to help customers, but the optics remain challenging.

• Regulatory caps limit profit potential.
• Affordability concerns drive political risk.
• Rate case outcomes directly impact revenue.

Financial and Market Exposure

Even with a regulated rate base, financial risks are real, particularly around capital access and interest rates. Consolidated Edison, Inc. plans a massive 10-year capital investment of nearly $72 billion, with $38 billion slated for the 2025-2029 period. Funding this requires constant access to capital markets, which the company addressed in Q1 2025 by issuing over $1.3 billion in new common equity.

Higher interest rates are also a direct cost. The company estimates that a 10% increase in interest rates on its variable-rate debt as of March 31, 2025, would increase annual interest expense by approximately $8 million for Consolidated Edison, Inc. and $7 million for its subsidiary, Consolidated Edison Company of New York (CECONY). They manage this by issuing mostly fixed-rate debt, but new financing is always exposed. Additionally, the company is evaluating strategic alternatives for its equity investment in the Mountain Valley Pipeline, LLC (MVP), which introduces an element of financial uncertainty outside the core utility business.

Operational and Climate-Related Risks

The physical and transition risks of climate change are now a major line item on the balance sheet. Consolidated Edison, Inc.'s service territory, especially New York City, faces increasing frequency and severity of extreme weather events. To combat this, the company has proposed significant resilience investments:

These investments are necessary to maintain the grid's world-class reliability, but they also represent a huge upfront cost that must be recovered through the aforementioned, politically sensitive rate cases. Failure to get full regulatory approval for these costs means the company absorbs the expense, or the grid's resilience suffers. The utility also faces challenges with aging infrastructure, particularly outside of New York City, at a time when electricity demand is growing due to electrification initiatives. You can read more about the company's long-term strategy here: Mission Statement, Vision, & Core Values of Consolidated Edison, Inc. (ED).

Growth Opportunities

You're looking for where Consolidated Edison, Inc. (ED) finds its next chapter of growth, and the answer is simple: massive, regulated capital investment in the clean energy transition. This isn't a tech stock with a sudden product-market fit; it's a utility with a clear, state-mandated roadmap for infrastructure spending. The core driver is the New York State Climate Leadership and Community Protection Act (CLCPA), which mandates significant decarbonization.

The company's strategy pivots on upgrading its transmission and distribution (T&D) systems to handle more intermittent renewable energy and facilitate widespread electric vehicle (EV) adoption. This is a defintely a long-term play. The capital expenditure (CapEx) plan is the engine here. For the 2025 fiscal year, the company is expected to allocate a significant portion of its projected $7.5 billion in CapEx toward these regulated utility investments. Here's the quick math: more investment in regulated assets means a larger rate base, which directly translates to higher allowed earnings.

• Fund major grid modernization projects.
• Expand transmission capacity for renewables.
• Support EV charging infrastructure build-out.

Future Revenue and Earnings Estimates

The predictable nature of a regulated utility's earnings is its greatest strength. Based on analyst consensus for the 2025 fiscal year, Consolidated Edison, Inc. (ED) is projected to generate revenues of approximately $15.8 billion. This steady, single-digit growth reflects the rate base expansion, not explosive market share gains. You won't see 20% year-over-year jumps, but you get stability.

Earnings per share (EPS) estimates for 2025 are equally important for dividend investors. The consensus points to an adjusted EPS in the range of $5.10 to $5.30. This growth is crucial because it underpins the company's ability to continue its decades-long history of dividend increases-a key attraction for income-focused portfolios. To be fair, these numbers are highly dependent on favorable rate case outcomes with the New York Public Service Commission (NYPSC). No rate hike, no EPS growth.

Strategic initiatives also play a role, particularly the continued focus on its competitive energy businesses, though the regulated utility segment remains the primary profit driver. You can read more about their long-term direction here: Mission Statement, Vision, & Core Values of Consolidated Edison, Inc. (ED).

Competitive Strengths and Growth Positioning

Consolidated Edison, Inc. (ED) holds a powerful competitive position, mainly rooted in its regulated monopoly status in one of the world's most economically vital regions: New York City and Westchester County. This geographic advantage is irreplaceable. Plus, its long-term planning and execution in the complex New York regulatory environment create a high barrier to entry for any potential competitor.

The company's competitive edge is not about product innovation, but about execution in infrastructure and regulatory affairs. They are essentially the sole provider of electricity, gas, and steam in their core territory. This translates into a highly reliable cash flow stream that few other companies can match. Their strategic positioning for growth is summarized in two key areas:

What this estimate hides is the regulatory risk. Any unexpected delay or unfavorable ruling from the NYPSC could immediately impact the growth trajectory. Still, their decades of experience navigating this environment give them a significant, hard-to-replicate advantage.