Constellation Energy is electric ? or at least its assets are.
Constellation recorded a 52-week high on shares of its stock Friday, trading as high as $74.20 a share. This news comes on the heels of the release of its fourth-quarter numbers, where Constellation reported net income of $405 million, a huge boost over the $195.2 million recorded during the same quarter in 2005.
“Constellation is definitely entrenched with a lot of good assets, and I don?t think competition could take away a lot of their business,” Morningstar stock analyst Paul Justice said.
For the year, Constellation reported total assets of around $21.7 billion, an increase of just less than $3 million from the year before. The company, however, endured a slight dip in Baltimore Gas and Electric, one of its subsidiaries. A supplier of power to the Baltimore region, BGE saw its fourth-quarter net income drop with $4.59 billion in 2006, compared with the $5.12 billion recorded a year earlier.
“It?s more of a long-term story,” Justice said. “It?s not a quarterly play per say, it?s something you have to look at the entire operating environment over the long haul.”
Constellation Energy is part of the Examiner?s Top 10 regional publicly traded companies being tracked for the year.
Many might attribute BGE?s drop in income to the unseasonably warm weather and lack of heating fuel use. Justice, however, said the weather is not as huge a factor as the rate-cap system that Maryland uses. When the rate-cap expires toward the end of 2007, the BGE bottom line will change, Justice said.
As for the market as a whole, the upward trends seem like they may continue. Loyola College economist Stephen Walters sees a tight-rope balance between inflation, the unemployment rate and the economy that benefits consumers.
“I think the prognosis for the near future is ?what?s not to like,? ” he said. “There?s no big cloud on the horizon.”
