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Exelon Corporation Message Board

  • chickemmen2002 chickemmen2002 Feb 5, 2013 1:56 PM Flag

    No dividend cut

    EXC will continue paying their dividend. The big reason for their lower earnings was due the the merge expenses. The earnings will be more since the merge expenses are behind us. All the EXC bashers will have egg all over their faces after the earnings are announced.


    Sentiment: Strong Buy

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    • Earnings won`t meet the mark,lower it will go-get ready to start throwing.

    • I agree with your comments - there is no need to change the dividend.

      • 2 Replies to followthevolume
      • I recently went long EXC but believe that your head is in the sand if you believe that all the pressure on the dividend is caused solely by merger related costs. We are in a major cycle where energy rates have plummeted. EXC has lost considerable power generation contracts throughout the Chicago area. This is largely due to the economic cycle but is also caused by the game changer of ultra cheap nat gas from fracking.

        The good news is that we are at or very near the trough of this cycle. Coal based providers are dropping like flies Midwest generation, Ameren, etc.) and significant capacity is coming out of the market. Opportunities will abound for the survivors. EXC has picked up opportunities to operate existing Nucs and some of the nat gas fired facilities which are also being liquidated might provide attractive future opportunities. EXC's position is also improving because some poor renewable energy hedges expire in May.

        EXC is on sound financial footing and is not nearly as leveraged as many of its competitors. It stands to be the 800 pound gorilla. However, that might require riding out the remainder of the cycle which could include some trimming of the div.

        The chief nemesis in the future after this cylce plays out will continue to be State regulatory bodies like the ICC. However, this situation is also beginning to brighten. California and Mass. have recognized that these state agencies form the chief impediment to roll out of smart grid technology. They are crafting legislation which will allow the power companies to recover their investment for green energy initiatives like smart grid. Expect other states to follow their lead.

        The US is in a very enviable position in the world since we have the cheapest power sources. I have to believe that someone in the executive or legislative branch has got to be smart enough to recognize that we could really press this advantage by improving the electrical grid infrastructure. It means lots of jobs and a chance of reverse decade old trends in manufacturing job losses. China is in the grips of crippling air pollution which has caused plant closings in the past weeks. Because they are tied closely to coal their economy will be throttled by the need for their population to breathe.

        These macro-conditions are creating a setting which could soon be very favorable to clean power producers.


      • Followthevolume there are to many buffoons on this board.


        Sentiment: Strong Buy

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