Constellation Energy Awards Significant Contracts by GSA
BofA Securities has reiterate its Buy rating on Constellation Energy (CEG) following the company’s announcement of being awarded over $1 billion in contracts by the General Services Administration (GSA). The largest energy procurement in GSA history, valued at $840 million, will provide Constellation with a significant premium to PJM power prices.
Key Highlights
- The 10-year contract will supply the GSA with more than 1 million MWhs annually.
- A $172 million Energy Savings Performance Contract has been awarded to improve energy efficiency.
- BofA Securities expects this deal to lead to a 11c increase in 2025 earnings and a 12c increase in 2026 earnings compared to prior forecasts.
Analyst Commentary
The analyst notes that the deal is at a significant premium to PJM power prices, indicating strong demand for Constellation’s services. This award is expected to drive growth and revenue for the company, supporting BofA Securities’ Buy rating.
Market Reaction
Constellation Energy shares have responded positively to the news, with a 5.3% increase in value following the announcement.
Leave A Comment