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Investing.com - KeyBanc has reiterated its Overweight rating and $337.00 price target on Constellation Energy (NASDAQ:CEG), currently trading at $333.71, following the release of PJM’s Base Residual Auction results. The company, with a market capitalization of nearly $100 billion, has delivered impressive returns with a 68% gain over the past year.
The PJM auction for the 2026/2027 planning year showed prices reaching the cap across all PJM zones, which KeyBanc views as positive for Constellation Energy and other independent power producers.
KeyBanc noted that the auction results demonstrate strong demand trends in the region that are sufficient to offset demand response and the inclusion of reliability must-run units.
The firm believes the pricing uplift should benefit Constellation Energy’s 2026 earnings, along with those of Public Service Enterprise Group (NYSE:PEG), which also has nuclear generation assets in the PJM region.
KeyBanc maintains that Constellation Energy will continue to benefit from favorable trends in the power markets, supporting its Overweight investment stance on the stock. This aligns with the broader analyst consensus, as tracked by InvestingPro, which maintains a bullish outlook on CEG with multiple additional insights and metrics available in the Pro Research Report.
In other recent news, Constellation Energy Corporation has made significant progress in its acquisition of Calpine Corporation. The company received regulatory approvals from both the New York State Public Service Commission and the Public Utility Commission of Texas, marking crucial steps toward completing the merger. This acquisition aims to combine Constellation’s nuclear fleet with Calpine’s natural gas and geothermal assets, creating a coast-to-coast energy provider.
Analysts have also adjusted their price targets for Constellation Energy. Mizuho (NYSE:MFG) raised its price target to $325, maintaining a Neutral rating, while BMO Capital and Wolfe Research both increased their targets to $350, with Outperform ratings. These adjustments reflect Constellation’s recent developments, including a 20-year virtual power purchase agreement with Meta Platforms (NASDAQ:META). This agreement involves purchasing carbon-free output from Constellation’s Clinton Nuclear facility, expected to generate 1.12 gigawatts starting in June 2027.
Constellation’s stock has been noted for its limited trading history and strategic deals, such as the one with Microsoft (NASDAQ:MSFT). These factors, along with the merger news, have contributed to its attractiveness in the market.
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