Dominion Energy reports fourth quarter 2025 results on February 23 before market open. The quarter provides the first test of whether Virginia data-center demand can sustain the company’s four-quarter streak of operating EPS beats while management navigates offshore wind execution risk and a payout ratio above 100%. Consensus sits at $0.95 EPS and $4.25B revenue, both representing year-over-year declines of 3.3% and growth of 7.8% respectively, creating a setup where the quality of earnings drivers matters more than the headline numbers.
The stock enters the print trading 42% above its 52-week low and 2.4% below its 52-week high, with shares up 7.5% in the past month against a 1.3% decline in the S&P 500. That outperformance reflects investor willingness to pay for regulated utility stability in a volatile market, but it also raises the bar for the quarter to justify a 21.6x P/E multiple that sits above the company’s calculated fair ratio of 24.2x on some metrics while dividend models suggest overvaluation by as much as 78%. The tension between execution credibility and valuation sustainability defines the setup.
Dominion’s recent pattern has been to beat quarterly estimates while preserving a $3.40 full-year operating EPS midpoint, a combination that has nudged consensus upward incrementally rather than forcing a full-year re-rate. The fourth quarter closes out 2025 with management’s most recent guidance framework of $3.33 to $3.48 still anchored at that $3.40 midpoint. A clean beat requires operating EPS above $0.95 and commentary that leaves the annual earnings center of gravity intact or better, particularly as the Street begins to model 2026 expectations around $3.60 operating EPS.
Current Price
$65.96
+$0.50 (+0.76%)
Analyst Target
$64.06
-2.9% downside
Market Cap
$56.32B
P/E Ratio
21.6
EPS Est.
$0.95
Rev Est.
$4.25B
Consensus Estimates
Metric
Consensus Est.
Range
Prior Guidance
YoY Change
EPS (Operating)
$0.95
$0.90 – $1.03
$3.33-$3.48 (FY25)
-3.3%
Revenue
$4.25B
$3.93B – $4.63B
Not disclosed
+7.8%
Full Year EPS
$3.41
$3.38 – $3.45
$3.33-$3.48 (mid $3.40)
Data center driven
Analysts Covering: 15
Estimate Revisions (30d): 2 up / 0 down
The estimate framework creates asymmetric risk. Consensus EPS of $0.95 sits 3.3% below the prior-year quarter’s $0.98, while revenue expectations of $4.25B represent 7.8% growth. That divergence reflects higher interest expense offsetting volume growth, a dynamic that has characterized each of the last four quarters. The $0.90 to $1.03 estimate range is wide enough to accommodate execution variance but narrow enough that a miss to the low end would raise questions about whether the full-year $3.40 midpoint remains achievable.
Estimate momentum turned negative over the past 30 days, with the consensus declining by $0.13 per share. Two analysts revised upward while none revised down, suggesting the decline reflects mathematical re-weighting rather than broad-based skepticism. That pattern differs from the three prior quarters, where upward revisions accumulated as Virginia and South Carolina demand exceeded initial Street assumptions. The shift matters because it removes one tailwind that had helped Dominion beat without raising the full-year bar.
“We expect to be at or above the midpoint of our operating earnings guidance range, assuming normal weather for the remainder of the year.”
Management’s most recent guidance, issued with third quarter results on October 31, 2025, narrowed the full-year operating EPS range to $3.33 to $3.48 while preserving the $3.40 midpoint that has anchored expectations since the beginning of 2025. That framework implies fourth quarter operating EPS of approximately $0.67 to $0.82 to reach the range, with the midpoint requiring roughly $0.75. Consensus at $0.95 sits 27% above the implied midpoint, creating a setup where a beat is priced in and the real test is whether management lifts 2026 guidance or introduces new constraints.
The company’s pattern over the past year has been to reaffirm rather than raise, even when quarterly results exceeded expectations by double-digit percentages. First quarter 2025 delivered a 24% EPS surprise ($0.93 versus $0.75 consensus), yet management kept the full-year midpoint at $3.40. Second and third quarters followed the same script, with beats of 10.3% and 12.8% respectively accompanied by range tightening but no midpoint lift. That discipline has prevented consensus from racing ahead of the company’s own confidence band, but it also means the Street is now looking for a signal that 2026 can sustain the momentum without requiring another year of “beat-and-hold” guidance posture.
“Data centers account for 27% of Dominion’s Virginia sales, and management expects data-center-driven demand to continue expanding over the long run.”
The Virginia data-center narrative has shifted from headline story to earnings driver. Reuters tied each of the last four quarterly beats to strong demand in Virginia and South Carolina, with data-center load growth explicitly called out as a contributor. The 27% sales concentration figure provides scale, but the investment question is whether Dominion can contract that load at terms that support rate base growth without triggering regulatory pushback on customer cost allocation. Management has not disclosed the average duration or pricing structure of data-center power purchase agreements, leaving the Street to infer sustainability from quarterly results rather than contractual visibility.
Analyst Price Targets & Ratings
Based on 20 analyst ratings
Wall Street maintains a cautious stance on Dominion, with 50% of analysts rating shares a Hold and only 40% recommending Buy or Strong Buy. The consensus target of $64.06 implies 2.9% downside from current levels, reflecting concerns about dividend sustainability and offshore wind execution risk. The lukewarm analyst sentiment contrasts with the stock’s recent outperformance, suggesting the market may be pricing in more optimism than the fundamental outlook supports.
Sector & Peer Comparison
Company
Ticker
Market Cap
P/E
Fwd P/E
Profit Margin
Dominion Energy
⭐ Focus
D
$56.32B
21.6
18.3
16.8%
Duke Energy
DUK
$88.5B
19.2
17.1
14.2%
Southern Company
SO
$95.1B
20.8
18.9
15.6%
Exelon
EXC
$44.2B
17.4
15.8
9.3%
NextEra Energy
NEE
$162.7B
24.1
21.6
18.9%
Dominion trades at a 21.6x P/E multiple, a 12% premium to Duke Energy and 4% premium to Southern Company, while sitting 10% below NextEra Energy’s 24.1x multiple. That positioning reflects the market’s willingness to pay for Virginia’s data-center exposure and offshore wind optionality, but it also creates vulnerability if execution falters. The company’s 16.8% profit margin exceeds Duke (14.2%) and Southern (15.6%), supporting the valuation premium, but lags NextEra’s 18.9% margin, which benefits from a higher renewable energy mix and less regulatory lag.
The forward P/E of 18.3x implies the market expects earnings growth to justify the current multiple, consistent with Street expectations for 2026 operating EPS of $3.60 (up 5.6% from the 2025 midpoint of $3.40). That growth rate aligns with Dominion’s historical 5-7% regulated utility earnings CAGR, but it assumes no material cost overruns on the Coastal Virginia Offshore Wind project and continued ability to recover data-center infrastructure investment through rates. The peer set suggests the market is pricing Dominion as a growth-oriented regulated utility rather than a pure yield vehicle, a posture that raises the bar for execution.
Earnings Track Record
Quarter
EPS Actual
EPS Est.
Result
Surprise %
Q3 2025
$1.06
$1.17
Miss
-9.4%
Q2 2025
$0.75
$0.68
Beat
+10.3%
Q1 2025
$0.93
$0.76
Beat
+22.4%
Q4 2024
$0.58
$0.55
Beat
+4.6%
Q3 2024
$0.98
$0.93
Beat
+5.4%
Q2 2024
$0.65
$0.56
Beat
+16.1%
Q1 2024
$0.55
$0.55
Met
0.0%
Q4 2023
$0.29
$0.38
Miss
-23.7%
Dominion has beaten consensus in 13 of the last 20 quarters, a 65% success rate that sits slightly above the utility sector average but below the 70-plus percent rates typical of best-in-class operators. The average surprise of negative 7.5% reflects two large misses (Q4 2023 at -23.7% and Q3 2025 at -9.4%) that skew the aggregate figure despite the company’s recent four-quarter beat streak from Q4 2024 through Q2 2025. That streak ended with the Q3 2025 miss, which came despite management narrowing its full-year range and reaffirming the $3.40 midpoint, suggesting the Street had gotten ahead of the company’s own confidence level.
The pattern that emerges is one of operational beats driven by demand strength (Virginia, South Carolina) offset by periodic misses when interest expense or timing items create headwinds. First quarter 2025’s 22.4% surprise was the largest in the lookback period and coincided with Reuters’ explicit callout of lower interest expense as a tailwind. By third quarter, that tailwind had reversed, contributing to the 9.4% miss even as revenue came in above expectations. The implication for the fourth quarter is that beating the $0.95 consensus likely requires both volume execution and favorable financing cost comparisons, a combination that may prove difficult to replicate.
Post-Earnings Price Movement History
📉
+0.1%
Avg. Move on Misses
Date
Surprise
EPS vs Est.
Next Day Move
Price Change
2025-09-30
-9.4%
$1.06 vs $1.17
-0.0%
$60.92 to $60.90
2025-06-30
+10.3%
$0.75 vs $0.68
+3.2%
$55.87 to $57.65
2025-03-31
+22.4%
$0.93 vs $0.76
+2.3%
$54.99 to $56.26
2024-12-31
+4.6%
$0.58 vs $0.55
+1.0%
$53.87 to $54.40
2024-09-30
+5.4%
$0.98 vs $0.93
+1.9%
$57.16 to $58.24
Dominion’s post-earnings price behavior shows muted reactions relative to the magnitude of surprises. The average next-day move of 1.4% sits well below the 3-5% swings typical of growth stocks, consistent with the regulated utility sector’s lower volatility profile. Beats generate an average 2.1% gain while misses produce only a 0.1% average move, suggesting the market focuses more on guidance and long-term trajectory than quarterly execution variance. The Q3 2025 miss, which produced a flat next-day reaction despite a 9.4% earnings shortfall, exemplifies this pattern.
The largest recent move came after Q2 2025, when a 10.3% beat drove a 3.2% stock gain. That reaction coincided with Reuters’ framing of the quarter in the context of surging data-center demand, indicating the market rewards beats when they validate a growth narrative rather than merely reflect timing or one-off items. First quarter 2025’s 22.4% surprise generated only a 2.3% stock move, likely because management’s decision to reaffirm rather than raise full-year guidance capped the upside. The implication is that a fourth quarter beat without a 2026 guide lift may produce a similarly restrained reaction.
Expected Move & Implied Volatility
Expected Move
±2.8%
($64.11 – $67.81)
Implied Volatility
18.5%
IV Percentile
42%
Historical Vol (30d)
16.2%
📊
Options pricing suggests a moderate-volatility event with the expected move slightly above recent historical averages
The options market prices a 2.8% expected move for Dominion following the earnings release, roughly double the 1.4% average historical next-day move. That premium reflects elevated uncertainty relative to the company’s recent track record, likely driven by investor focus on offshore wind project updates and potential 2026 guidance introduction. Implied volatility of 18.5% sits at the 42nd percentile of its one-year range, indicating options are not pricing an outsized event but are incorporating more risk than the stock’s 16.2% realized 30-day volatility would suggest.
The $64.11 to $67.81 expected range brackets the current $65.96 price symmetrically, with the upper bound sitting just above the $67.57 52-week high. A move to the high end would require not just an earnings beat but constructive commentary on offshore wind cost containment and 2026 earnings visibility. Conversely, a move to the low end would likely reflect either a miss on operating EPS or management commentary that raises questions about dividend sustainability given the 105% payout ratio. The options market is pricing the possibility of either outcome with roughly equal probability.
What To Watch
Key Outlook: Cautiously Neutral
Neutral with Bearish Tilt
Dominion likely beats the $0.95 consensus on continued Virginia demand strength, but the combination of negative estimate momentum, a 105% payout ratio, and lack of 2026 guidance visibility creates asymmetric risk. A beat without a credible path to dividend sustainability or offshore wind cost containment may not sustain the stock’s recent outperformance.
⚡ MEDIUM CONFIDENCE
The setup favors a tactical beat on operating EPS driven by the same Virginia and South Carolina demand dynamics that produced beats in four of the last five quarters. Revenue consensus of $4.25B appears conservative given the 7.8% year-over-year growth implied and the company’s track record of exceeding topline expectations when data-center load materializes. The constraint is that consensus has already declined by $0.13 over the past 30 days, removing the tailwind of upward revisions that characterized earlier 2025 quarters. A beat that merely matches the pattern of Q4 2024 (4.6% surprise) would produce operating EPS around $0.99, modestly above consensus but not enough to force a material re-rate.
The larger question is whether management uses the quarter to address the dividend sustainability narrative. With a payout ratio of 105% and return on equity of 6.72%, the math suggests the current $2.69 annual dividend (4.08% yield) is being funded partially through balance sheet capacity rather than earnings alone. Dividend discount models cited in recent coverage suggest the stock may be overvalued by as much as 78%, while P/E-based metrics indicate undervaluation, creating a valuation disconnect that can only be resolved through clearer guidance on earnings growth trajectory and capital allocation priorities. A beat without that clarity leaves the bull case incomplete.
Operating EPS exceeds $1.00 (5% above consensus) on stronger-than-expected Virginia data-center revenue and lower interest expense. Management introduces 2026 operating EPS guidance of $3.65 to $3.75 (midpoint $3.70, 8.8% above 2025), provides constructive offshore wind cost update showing the project on budget, and reaffirms dividend growth at historical 2-3% annual rate.
Target: $72
Operating EPS of $0.88 to $0.92 (in line with or below consensus) as interest expense headwinds offset volume gains. Management introduces 2026 guidance of $3.45 to $3.55 (midpoint $3.50, only 2.9% growth), cites offshore wind cost pressures requiring incremental capital, and signals dividend growth will be constrained to preserve balance sheet flexibility.
Target: $58
Key Metrics to Watch
📊
Operating EPS vs. $0.95 Consensus
Target: $0.98 or higher (3% beat minimum)
A beat below 3% would represent the weakest surprise in the recent four-quarter streak and raise questions about whether Virginia demand is plateauing.
🔮
2026 Operating EPS Guidance Introduction
Target: $3.65-$3.75 range (midpoint $3.70)
Street expectations sit at $3.60 for 2026. Guidance above that level would validate the growth narrative and support the current P/E premium to peers.
💹
Coastal Virginia Offshore Wind Project Update
Target: On-budget confirmation, no timeline delays
Recent coverage has emphasized mounting project costs as a risk factor. Any indication of cost overruns or timeline slippage would reignite concerns about capital allocation.
💰
Interest Expense Trajectory
Target: Flat to down sequentially
Interest expense was cited as a tailwind in Q1 2025 and a headwind by Q3 2025. The direction matters for margin sustainability and dividend coverage.
📈
Virginia Data-Center Contracting Commentary
Target: Multi-year contract visibility, explicit cost recovery terms
Data centers represent 27% of Virginia sales, but the Street lacks visibility on contract duration, pricing escalators, and regulatory approval for cost recovery.
The interplay between these metrics will determine whether the stock can sustain its recent outperformance. A scenario where Dominion beats on operating EPS but fails to introduce 2026 guidance or address offshore wind cost concerns would likely produce a muted reaction similar to Q3 2025, when a 12.8% beat generated only a 1.09% pre-market gain. Conversely, a beat combined with constructive 2026 guidance and offshore wind reassurance could drive the stock toward the $72 bull case target, particularly if management articulates a credible path to improving return on equity from the current 6.72% toward the 9-10% range typical of higher-quality regulated utilities.
The dividend sustainability question looms over all other considerations. With a 105% payout ratio and negative implied dividend growth, the market is pricing in either a payout ratio reduction (via earnings growth) or a dividend growth slowdown. Management’s commentary on this topic will likely matter more for the stock’s medium-term trajectory than the fourth quarter EPS figure itself. A clear statement that the company can grow earnings at 5-7% annually while maintaining a 2-3% dividend growth rate would address the valuation disconnect between P/E-based undervaluation and dividend-model overvaluation. Silence or ambiguity on this point would leave the bear case thesis intact.
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