DUK, Duke Energy Corporation
Duke Energy operates in the U.S. primarily through its direct and indirect subsidiaries.
Read top to bottom, the owner's questions in the order an owner asks them: what the business is, whether the record holds, whether it survives and is any good, and what you would be paying. New to the questions? Start with the Method.
The business in brief
read the 10-K →What this business is and what moves its needle, drawn from its own SEC filings. The lens to bring to the numbers below, not the answer.
- What it is
- Revenue is Electric Utilities and Infrastructure (91%), Gas Utilities and Infrastructure (9%) and Other (0%).
- What moves the needle
- Rate base and the allowed return. What decides it: the capital plan the regulator approves, the return allowed on that base, and the cost of the debt that funds it. Growth is the rate base; the risk is the regulatory compact and rising rates. On its own account, the filing leans hardest on supplier & input dependence, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Return on capital has rarely cleared the cost of capital (median 4%, above 15% in 0 of 10 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the 10-K is where you look.
No model wrote a word of this. Every line is arithmetic on the company's filings, shown in full in the sections below; the judgment is yours.
Where the money comes from
read the 10-K →Electric Utilities and Infrastructure is 91% of revenue, so this is largely a single-segment business.
- Electric Utilities and Infrastructure91%$28.9B
- Gas Utilities and Infrastructure9%$2.9B
- Other0%$28M
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record, 2011–2025
realized figures from each filing, no estimates| 2011’11 | 2012’12 | 2018’18 | 2019’19 | 2020’20 | 2021’21 | 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMMar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| RevenueRevenue | $14.5B | $19.6B | $23.8B | $24.3B | $23.3B | $24.5B | $28.7B | $28.7B | $30.1B | $31.7B | $32.5B |
| Operating marginOp. mgn | 19.1% | 14.8% | 19.7% | 23.4% | 19.7% | 22.5% | 21.0% | 24.7% | 26.4% | 27.2% | 27.7% |
| Net incomeNet inc. | $1.7B | $1.8B | $2.7B | $3.7B | $1.4B | $3.9B | $2.5B | $2.8B | $4.5B | $5.0B | $5.1B |
| EPS (diluted)EPS | $3.84 | $3.07 | $3.77 | $5.14 | $1.87 | $5.08 | $3.31 | $3.68 | $5.86 | $6.39 | $6.60 |
| Owner earningsOwner earn. | ($691M) | ($257M) | ($2.2B) | ($2.9B) | ($1.1B) | ($1.4B) | ($5.4B) | ($2.7B) | $48M | ($1.7B) | ($3.3B) |
| ROICROIC | 5% | 3% | 4% | 5% | 4% | 4% | 4% | 5% | 5% | 5% | 5% |
| CapexCapex | $4.4B | $5.5B | $9.4B | $11.1B | $9.9B | $9.7B | $11.4B | $12.6B | $12.3B | $14.0B | $15.0B |
| Capex / revenueCapex/rev | 30.0% | 28.0% | 39.5% | 45.7% | 42.6% | 39.7% | 39.6% | 44.0% | 40.9% | 44.2% | 46.0% |
| Capex vs depreciationCapex/dep | 2.15× | 2.07× | 2.00× | 2.15× | 1.81× | 1.72× | 1.95× | 2.07× | 1.91× | 1.82× | 1.89× |
| Total debtDebt | $21.0B | $40.5B | $57.9B | $61.3B | $62.7B | $67.1B | $73.7B | $79.5B | $84.3B | $89.8B | $89.8B |
| Cash & investmentsCash+inv | $2.5B | $1.8B | $442M | $311M | $259M | $341M | $409M | $253M | $314M | $245M | $2.3B |
| Net debt / (cash)Net debt | $18.5B | $38.8B | $57.5B | $61.0B | $62.5B | $66.8B | $73.3B | $79.3B | $84.0B | $89.6B | $87.5B |
Owner’s Scorecard
Will it survive?
- AdequateOperating income $8.6B ÷ interest expense $3.6B
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
- How heavy is the debt? 10.4×HighTotal debt $89.8B ÷ operating income $8.6B
Years of operating profit it would take to repay all debt. A first read, not a credit rating: it's gross debt (not netted against cash) over EBIT (not EBITDA), and a cyclical year distorts it.
- Debt, net of cash $89.5BHeavy net debtCash $245M + ST investments $44M − debt $89.8B
Netting $289M of cash and short-term investments against $89.8B of debt leaves $89.5B owed, about 10.4× a year's operating profit, versus the gross figure above. It also holds $190M in longer-dated marketable securities; counting those, it sits at $89.4B of net debt. Net debt is the leverage figure that matters; the gross ratio above ignores the cash already set against it. Strategic or illiquid investments aren't counted here.
- Negative, funded by othersDSO 0 + DIO 85 − DPO 279 days
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.
Is it a good business?
- Below averageNOPAT $7.6B ÷ invested capital $141.4B (debt + equity − cash)
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; below ~8% the company may destroy value as it grows. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Consumes cashOwner Earnings ($1.7B) = operating cash $12.3B − capex $14.0B
What an owner could take out without starving the business. That's -5% of revenue. Treating stock comp as the real expense it is (less $67M of SBC) leaves ($1.8B). Honest caveat: capex here blends maintenance and growth, so steady-state Owner Earnings may run higher (see capex vs. depreciation).
- Cash-backedCash from ops $12.3B ÷ net income $5.0B
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- No surplus to allocate
The business didn't generate positive Owner Earnings this year, so any distributions came from the balance sheet or borrowing, not from operations.
- Investing or harvesting? 1.82×ExpandingCapex $14.0B ÷ depreciation $7.7B
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Durability & moat, 2011–2025
A moat is a high return that doesn’t fade, reinvested at high returns. Here is what the record says, judgments, not another chart of the numbers.
- Profitable years 10 of 10
Never lost money over the record, the earnings stability Graham insisted on.
- Return on capital ≥ 15% 0 of 10 yrs
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
- Operating margin 19% (FY2011) → 27% (FY2025)
Margins widened over the record, pricing power intact or improving.
- Reinvestment, incremental ROIC 7%
Reinvested capital earned only a modest return, growth is getting expensive.
- Worst year 2012 · 14.8% op. margin
Stayed profitable even in its hardest year, the resilience that survives recessions.
- Share count +4.1%/yr
The share count is rising, dilution works against you on a per-share basis.
- Dividend record rising
Paid and raised the dividend across the record, the continuity Graham prized.
Solvent is not the same as cheap; growing is not the same as good. These are vital signs, not a verdict, the judgment is yours, and the filing is one click away.
How the cash was used, 2011–2025
Over the record, the business generated $81.9B of operating cash, and how management split it is, as Buffett insists, the job that matters most. Here it reads as a reinvestor, most operating cash is plowed back into the business.
- Reinvested$100.3B · 122%
- Dividends$17.3B · 21%
It reinvested $100.3B (122%) back into the business and returned $17.3B (21%) to owners, $17.3B in dividends, $0 in buybacks. Total debt rose $68.8B across the span. It returned and reinvested more than it generated, the gap was covered by debt or existing cash.
Buybacks are gross of stock issued to employees; net of that, the real return to owners is lower (see Management & pay). And the mix alone doesn't grade management, what matters is the return earned on the dollars reinvested (see incremental ROIC in the durability report).
Management & pay
Two questions Buffett actually asks about pay: is stock compensation, a real expense, whatever the income statement pretends, quietly large, and is the top wildly out of line with the floor. He's no populist about it; he just wants pay that's rational and earned, and comp committees that aren't lapdogs.
- Stock-based compensation$67M
The slice of the business handed to employees in shares this year, 0% of revenue, equal to 1% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. And note the trap, the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Graham’s defensive-investor test
3 of 6 metGraham gave the defensive investor seven numerical criteria in The Intelligent Investor. Here they are, run mechanically on the filings, his framework, not our verdict. Meeting them is a floor of safety, not a reason to buy; missing one is no veto, since many fine modern businesses fail his strictest liquidity tests by design. The worth is in seeing exactly where a company stands against the canon, every number sourced.
- Adequate size PassRevenue ≥ $2B · $31.7B
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity MissCurrent ratio ≥ 2× · 0.55×
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt MissDebt ≤ working capital · $89.8B vs ($9.4B) WC
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Earnings stability PassA profit every year (10-yr record) · no losses
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
- Dividend record MissUninterrupted dividends · 7 of 10 yrs
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
- Earnings growth PassEarnings +33% over the record · +101%
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Earnings are $6.39/share and book value $66.72/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Graham would be the first to say a checklist is a starting point, not an answer. These are his defensive, bargain-hunter's tests, the cigar-butt lens. Buffett and Munger grew past it, paying fair prices for wonderful businesses; that lens lives in the moat and owner-earnings work above, and both still matter. Clearing Graham’s tests earns a closer look; failing them earns harder questions, not a dismissal.
What the price implies
reverse-DCFOwner earnings are negative today, so the usual reverse-DCF has nothing to grow. But that's exactly when a price makes its boldest promise. So we flip the question: type a price, and see the future profitability you'd have to believe to justify it.
Enter a price to run it.
It flips the reverse-DCF: the company must reach owner earnings that, valued at a mature multiple and discounted back at your rate, equal today's market cap, shown as the margin it must earn on revenue grown at your rate, from negative today. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this is for the genuinely unprofitable.
What the filing emphasizes, FY2025
read the 10-K →Each year a 10-K must name what could go wrong, in the company's own words. Here are the ones Graham and Buffett would stop on, each set against the figure from the same filings that bears on it, anchored to a period you can find in the record above. We point; the judgment is yours.
- Supplier & input dependenceBusiness
A choke point upstream. A sole or limited supplier can dictate terms, and a single shortage can stop the line.
“Competition Retail EU&I's businesses operate as the sole supplier of electricity within their service territories, with the exception of Ohio, which has a competitive electricity supply market for generation service.”
From the recordGross-margin cushion (TTM)79% - Debt terms & refinancingMD&A
The fine print behind the debt. Covenants and near-term maturities decide who is really in control when a year goes badly.
“Duke Energy may not redeem the convertible notes prior to the maturity date and payments due as a result of a conversion of a convertible note would not constitute an event of default under the Master Credit Facility.”
From the recordBalance sheet (TTM)$89.5B heavy net debt · interest covered 2.4× - Litigation & contingenciesMD&A
Claims an owner inherits. Most disclosure is boilerplate; this fires only on an actual matter, a named suit, a settlement, a contingency, a number.
“Nuclear Compensation Class Action Litigation On July 11, 2025, plaintiffs Leo Dorrell and John Dunn filed a putative class action lawsuit in the U.S.”
A judgment, not a number, weigh it against the filing yourself. - Cyclicality & demandRisk Factors
How the business behaves when the economy turns. A cyclical earns its keep across the whole cycle, not at the peak.
“A continuation of adverse economic conditions including economic downturn or high commodity prices could also negatively impact the financial stability of certain of our customers and result in their inability to pay for electric and natural gas services.”
From the recordWorst year on record14.8% operating margin (FY2012) - Regulation & policyMD&A
Rules that can rewrite the economics, tariffs, antitrust, data, export controls.
“In addition, the IRA created a new, zero-emission nuclear power PTC and a clean hydrogen PTC. 225 FINANCIAL STATEMENTS INCOME TAXES Duke Energy Carolinas has $ 913 million and $ 449 million of nuclear PTCs recorded on its consolidated balance sheets as of December 31, 2025, and 2024, respectively.”
A judgment, not a number, weigh it against the filing yourself.
What changed, FY2025 vs FY2024
read the 10-K →Most of a 10-K is boilerplate carried over verbatim; the signal is in what's new. These lines appear this year and weren't there last, figure updates filtered out, so only the language shift remains.
- “These charges, along with amortization of severance-related regulatory deferrals and the reversal of certain prior period severance costs, resulted in a total severance charge of $ 102 million in 2023. 210 FINANCIAL STATEMENTS SEVERANCE The following table presents the direct and allocated severance…”
- “Estimated remaining performance obligations as of December 31, 2025, are as follows: Remaining Performance Obligations (in millions) 2026 2027 2028 2029 2030 Thereafter Total Piedmont $ 54 $ 48 $ 45 $ 44 $ 42 $ 109 $ 342 Other The remainder of Duke Energy's operations is presented as Other, which do…”
- “Costs are typically expensed as Operation, maintenance and other in the Consolidated Statements of Operations unless regulatory recovery of the costs is deemed probable. 162 FINANCIAL STATEMENTS COMMITMENTS AND CONTINGENCIES The following table contains information regarding reserves for probable an…”
- “For the EU&I and GU&I segments, revenue by customer class is most meaningful to Duke Energy as each respective customer class collectively represents unique customer expectations of service, generally has different energy and demand requirements, and operates under tailored, regulatory approved pric…”
- “Some or all of these factors could result in a lack of growth or decline in customer demand for electricity or number of customers and may cause the failure of the Duke Energy Registrants to fully realize anticipated benefits from significant capital investments and expenditures, which could have a …”
Classic text analysis over the filing itself, no model wrote a word of this, and every quote is the company's own.
Peers, Utilities
The same industry, side by side on owner economics, compare, don't rank by a single number.● marks best in the group.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| DUKDuke Energy Corporation | $31.7B | 78% | 27.2% | 5% | -5% |
| EXCExelon Corporation | $24.3B | — | 21.2% | 5% | -9% |
| EDConsolidated Edison Inc | $17.0B | — | 17.2% | 5% | 2% |
| SRESempra | $12.4B | — | 32.8% | 5% | -49% |
| PEGPublic Service Enterprise Group Inc | $12.2B | 75% | 24.5% | 7% | 0% |
| XELXcel Energy Inc | $11.5B | 67% | 22.4% | 5% | -59% |
| WECWEC Energy Group, Inc. | $9.8B | 67% | 22.9% | 6% | 7% |
| AEEAmeren Corp | $8.8B | — | 23.0% | 6% | -9% |