How Duke Energy’s (DUK) South Carolina Settlement May Shape Its Returns and Investment Story

In the past week, Duke Energy Progress, a subsidiary of Duke Energy, reached a partial settlement with the Public Service Commission of South Carolina, securing a 9.99% return on equity, provisions for nuclear and production tax credits, increased reserve funding, and a proposed pension cost rider to support financial stability. This agreement addresses regulatory certainty and cash flow for major grid and pension investments at a time when utility earnings and rate structures are drawing heightened investor and customer scrutiny. We'll explore how regulatory clarity from the partial rate case settlement may impact Duke Energy's future earnings and investment narrative.

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Duke Energy Investment Narrative Recap

To be a Duke Energy shareholder, you need to believe in the stability of regulated utility returns, reliable rate structures, and the company's ability to adapt during ongoing grid modernization and energy transitions. The partial settlement, which sets a 9.99% return on equity and clarifies regulatory costs in South Carolina, may meaningfully reduce near-term earnings risk from regulatory uncertainty, but does not remove longer-term challenges around capital needs and external financing exposure.

Among recent announcements, the confirmation of Duke's quarterly dividend at $1.065 per share stands out, aligning with the company's emphasis on steady payouts and cash flow, a key appeal for utility investors. Reliable earnings and robust dividend continuity remain closely tied to positive outcomes in regulatory proceedings, such as the latest South Carolina agreement, yet ongoing capital spending requirements persist as an important factor for investors to monitor.

However, before getting too comfortable with the recent regulatory clarity, it's vital to remember that rising interest rates and capital costs could still...

Read the full narrative on Duke Energy (it's free!)

Duke Energy's outlook anticipates $35.4 billion in revenue and $6.1 billion in earnings by 2028. This projection is based on a 4.7% annual revenue growth rate and a $1.4 billion increase in earnings from the current $4.7 billion.

Uncover how Duke Energy's forecasts yield a $137.60 fair value, a 11% upside to its current price.

Exploring Other PerspectivesDUK Community Fair Values as at Nov 2025

Seven private investors in the Simply Wall St Community estimate Duke Energy's fair value anywhere from US$64.74 to US$137.60. While opinions run wide, significant future capital requirements may influence whether the company can sustain current payout levels and earnings momentum, explore the array of views and judge for yourself.

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Explore 7 other fair value estimates on Duke Energy - why the stock might be worth 48% less than the current price!

Build Your Own Duke Energy Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

A great starting point for your Duke Energy research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision. Our free Duke Energy research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Duke Energy's overall financial health at a glance.

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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.

Companies discussed in this article include DUK.

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