Will Rising Revenues Support Constellation Energy's Long-Term Growth?

CEG's rising revenues, long-term nuclear PPAs and fleet extensions support stronger earnings and more predictable growth.

Zacks Equity Research

2 min read

Constellation Energy’s CEG expanding revenues are helping offset higher costs, supported by stronger commercial performance and contributions from its broader generation portfolio. Revenue growth strengthens CEG’s financial performance by supporting cash generation and enhancing financial flexibility.

During the second quarter of 2026, operating revenues rose 23% year over year to $7.50 billion, driven partly by the Calpine acquisition, higher capacity revenues and stronger commercial performance. Adjusted operating earnings increased 33.5% to $2.55 per share, demonstrating that revenue growth can translate into stronger earnings when margins and portfolio performance improve.

Constellation signed nearly 920 megawatts (MW) of long-term nuclear power purchase agreements (PPAs), with an average duration of 18.5 years. The agreements begin between 2029 and 2031 and fully ramp up by 2032. CEG expects nearly 30% of its baseload clean-generation megawatt-hours to be covered by long-term agreements. This growing contracted portfolio should improve revenue visibility, provide greater earnings stability and support more predictable long-term growth. CEG projects 20%+ base-adjusted operating earnings growth through 2029, alongside a 10%+ long-term, rolling three-year base EPS growth target.

CEG filed license renewal applications for Ginna and Nine Mile Point Unit 1, targeting operations through 2049, while advancing the Crane Clean Energy Center restart following approvals from the Federal Energy Regulatory Commission and the Nuclear Regulatory Commission. Extending CEG’s nuclear fleet life could support revenue growth from additional generation and long-term PPAs.

Overall, stronger revenue growth could support CEG’s long-term earnings, provided it manages costs and converts contracted opportunities into sustainable margins.

Revenue Growth Helps Utilities Manage Rising Costs

Growing revenues are improving utilities’ top-line performance, helping offset higher fuel, supply and operating expenses. This strengthens overall performance and supports continued infrastructure investment and long-term earnings growth.

Clearway Energy CWEN: Operating revenues rose 22.7% year over year to $481 million in the second quarter of 2026 from $392 million, while operating income increased 36.5% to $116 million from $85 million.

NRG Energy NRG: Revenues increased 11% year over year to $7.48 billion in the second quarter of 2026 from $6.74 billion, while operating income improved to $976 million from zero in the year-ago quarter.

The Zacks Rundown on CEG

CEG’s Earnings Estimates

The Zacks Consensus Estimate for 2026 and 2027 EPS indicates an increase of 28.01% and 7.96%, respectively, year over year.

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CEG’s Returns on Equity (ROE)

Constellation's trailing-12-month ROE is 14.89%, ahead of the industry average of 7.94%.

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CEG’s Stock Price Performance

In the past month, the company’s shares have risen 1.4% against the industry’s 2.7% fall.

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CEG’s Zacks Rank

CEG currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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