SeekingAlpha  Aug 15  Comment 
By Abba's Aces: The last time I wrote about Duke Energy (NYSE:DUK) I stated, "Due to the tiring high dividend payout ratio, low earnings growth potential, and deteriorating financial efficiency ratios, I'm not going to be pulling the trigger right...
Forbes  Aug 14  Comment 
The best performing sector as of midday Thursday is the Utilities sector, higher by 0.9%. Within that group, Pinnacle West Capital (NYSE: PNW) and Duke Energy (NYSE: DUK) are two large stocks leading the way, showing a gain of 1.8% and 1.4%,...
Market Intelligence Center  Aug 13  Comment 
The patented options-trade picking algorithms used by MarketIntelligenceCenter.com found a trading opportunity with Duke Energy Corp (DUK) that should provide a 2.15% return in just 157 days. Sell one Jan. '15 call at the $70.00 level for each 100...
SeekingAlpha  Aug 12  Comment 
ByEquity Watch: Duke Energy (NYSE:DUK) is among the leading utility companies in the U.S. DUK have been posting a healthy financial performance in the past. The company's earnings and dividend growth are likely to benefit from its ramping up of...
SeekingAlpha  Aug 7  Comment 
Duke Energy Corporation (NYSE:DUK) Q2 2014 Earnings Call August 7, 2014 10:00 AM ET Executives Bill Currens – Vice President, Investor Relations Lynn Good – President and Chief Executive Officer Steve Young – Executive Vice...
TheStreet.com  Aug 7  Comment 
NEW YORK (TheStreet) -- Shares of Duke Energy Corp  are up 2.41% to $71.52 in early market trading following the company's strong second quarter earnings, highlighted by an 80% jump in profit due to favorable weather and a lower tax rate. The...
Benzinga  Aug 7  Comment 
Duke Energy (NYSE: DUK) reported upbeat second-quarter profit and lifted its full-year profit outlook. Duke now expects full-year adjusted profit of $4.50 to $4.65 per share, versus its earlier forecast of $4.45 to $4.60 per share. The...
Wall Street Journal  Aug 7  Comment 
Jutia Group  Aug 7  Comment 
[PR Newswire] - CRYSTAL RIVER, Fla., Aug. 7, 2014 /PRNewswire/ -- Duke Energy Florida announced today it will sell at auction a wide variety of new and used tools and equipment, ranging from cranes to hand tools, from its retired Crystal River...
Reuters  Aug 7  Comment 
Duke Energy Corp reported a better-than-expected profit for the third straight quarter as higher temperatures forced customers to use more air conditioning this summer, raising electricity consumption.
Forbes  Aug 6  Comment 
In the month leading up to the Duke Energy's second quarter earnings announcement slated for Thursday, August 7, 2014, expectations have risen for the upcoming results. The consensus analyst estimate has gone from 94 cents per share to the current...


is one of the five largest electric utility companies in the United States, providing 28,000 megawhats of electricity to 3.9 million customers in North Carolina, South Carolina, Indiana, Ohio and Kentucky[1][2] - enough electricity to power over 20 million homes. Duke is unusual among electric utilities in that it produces only 1/3 of its electricity from coal. This effectively insulates it against increases in coal prices and means its power generation portfolio is more diverse than that of its peers.

==Business Overview==8============d

Business & Financial Metrics[3]

In 2009, Duke generated a net income of $1.08 billion on revenues of $12.73 billion. This represents a 20.1% decrease in net income and a 3.6% decrease in total revenues from 2008, when the company earned $1.36 billion on $13.21 billion in revenue.

Business Segments[4]

U.S. Franchised Electric and Gas (85.6% of EBIT)

U.S. Franchised Electric and Gas (now U.S. Franchised Electric post Spectra spin-off), operates in North Carolina, South Carolina, Indiana, Ohio and Kentucky.

Commercial Power (1.0% of EBIT)

Owns and operates unregulated power plants primarily within the Midwest. Develops, owns and operates electric generation sources that serve large energy consumers, municipalities, utilities and industrial facilities.

Duke Energy International (13.5% of EBIT)

Operations are located in Central and South America with approximately 4,000 MW of generation, primarily hydroelectric, in six countries: Argentina, Brazil, Ecuador, El Salvador, Guatemala and Peru.


Key Trends/Forces

Rising Fossil Fuel Prices

Prices for fossil fuels, the key energy input for many of Duke’s electrical generation plants, have risen steadily over the past few years with the price of oil approximately quadrupling since the year 2000.[5] The booming overseas growth from industrializing counties such as China and India have pushed fossil fuel demand and prices new to new heights. To hedge against a sustained high energy price environment, Duke Energy, other utility companies and the government, have been forced to look at alternate means of energy production which are cost effective and clean. Duke which only produces 56% of its energy from coal, is already well below the industry average in its use of fossil fuels.

Nuclear Power & Electricity Generation

The key difference between nuclear and fossil plants is the cost structure. Nuclear plants require very large capital investments (to construct the plant) but little expenditure for fuel because it takes relatively little uranium to power a plant. On the other hand, fossil fuel plants require relatively little capital investment but have high fuel costs because they require large amounts of coal, oil or gas. In the past, low fossil fuel prices gave given fossil fuel plants a cost advantage over nuclear plants. The cost advantage, compounded by the stigmas of nuclear energy (the not in my backyard phenomenon) has prevented new nuclear construction for almost 30 years.[6] Record fossil fuel prices have begun to reverse this trend. The possibility and implications of peak oil may reinforce this reversal. Already, nuclear utilities such as Duke Energy, Exelon and Entergy have begun filing for permits for construction of new nuclear plants.

Of course, it is critical to remember that a substantial portion of Duke Energy's business remains vulnerable to rising energy prices and could see a negative impact on earnings if fossil fuel prices continue to rise.

In all, the legislative environment is favorable for Duke Energy. Increasing concern over global warming makes US carbon emission legislation likely in the short to midterm. Because a significant portion of Duke's portfolio is in nuclear energy any legislation based on carbon trading markets will allow Duke to offset emissions at its carbon based plants with carbon credits from its renewable and nuclear plants.

Global Warming and Environmentalism

Over the past few years, global warming has moved from the fringes to become one of the single greatest single challenges facing the world today. A growing body of scientific evidence ties carbon dioxide emissions to rising temperatures. As a result of growing popular awareness of the risks of global warming, many large corporations have stepped up their efforts to project greener images. Additionally, many expect the U.S. government to enact more stringent legislation limiting carbon emissions. Environmental awareness is another key trend driving the renaissance of nuclear energy. Compared to their fossil fuel peers, nuclear energy plants have negligible emissions. Duke operates a number of hydroelectric, alternative and renewable energy plants. The company recently began to push for higher efficiency standards and other environmentally friendly state policies in the areas it operates, probably hoping that a paradigm shift will facilitate a shift towards renewable energy, ultimately benefiting the company.


Duke's competitors include:


  1. [Segments]
  2. DUK's Energy Business Segments
  3. DUK 2009 10-K pg. 33  
  4. 4.0 4.1 DUK 2009 10-K pg. 39  
  5. NYTimes (9/13/07) - Crude Oil Price Closes above $80
  6. Scientific American (9/26/07) - Nuclear Power Reborn
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