How Is CEG Using Acquisitions to Accelerate Clean Energy Growth?

Constellation Energy Corporation CEG is leveraging strategic partnerships to expand its market reach, enhance its clean energy portfolio and develop innovative technologies. These partnerships allow the company to offer more comprehensive solutions to customers and drive growth in the clean energy sector. The objective of the company is to make opportunistic energy acquisitions with a focus on reliability.

In January 2025, Constellation Energy announced to acquire Calpine in a cash and stock transaction valued at an equity purchase price of nearly $16.4 billion. The agreement will combine the nation’s leading clean energy producer with Calpine's reliable, dispatchable natural gas assets, opening up opportunities to supply more customers coast-to-coast. In June 2025, CEG received regulatory approval from the New York State Public Service Commission and the deal is expected to be closed in the fourth quarter of 2025. 

This acquisition is expected to significantly boost CEG’s earnings per share (EPS) by more than 20% in 2026, and further add at least $2 to EPS through 2029. Additionally, the combined company is projected to generate more than $2 billion in free cash flow before growth annually. 

In 2023, CEG also acquired a 44% ownership stake in the South Texas Project Electric Generating Station for $1.75 billion. This transaction included nearly 1,100 megawatts (MW) of the plant's output, expanding CEG’s carbon-free nuclear fleet.

CEG is benefiting from its strategic acquisitions. This enhances its position as a leading clean energy provider, expanding its customer base and increasing financial strength. The company’s strategic acquisitions are projected to deliver immediate earnings accretion, significant free cash flow and opportunities to reinvest in clean energy technologies.

Utilities Expanding Through Acquisitions

Some other utility companies that are also focused on expanding operations through acquisitions have been discussed below:

NRG Energy NRG will acquire a portfolio of natural gas generation facilities and a commercial and industrial virtual power plant platform from LS Power. The acquisition will double NRG’s generation capacity to 25 GW, adding modern, flexible natural gas assets. 

Vistra Corp. VST has executed a definitive agreement to acquire seven modern natural gas generation facilities, totaling nearly 2,600 MW of capacity, from Lotus Infrastructure Partners. The deal is expected to be closed in late 2025 or early 2026.

CEG Stock’s Earnings Estimates

The Zacks Consensus Estimate for Constellation Energy’s 2025 and 2026 EPS indicates an increase of 9% and 22%, respectively.

CEG Stock Trading at a Premium

CEG is trading at a premium relative to the industry, with a forward 12-month price-to-earnings of 30.08X compared with the industry average of 20.72X.

CEG Stock’s Price Performance

In the past six months, CEG’s shares have risen 29.8% compared with the industry’s 13.2% growth.

CEG’s Zacks Rank

CEG currently has 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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This article originally published on Zacks Investment Research (zacks.com).

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