Constellation Energy Stock Soars on Its $26 Billion Buy. Here's Why Wall Street Likes the Deal
Constellation Energy is one of the best S&P 500 stocks Friday after the utility said it will buy Calpine in a cash-and-stock deal valued at $26 billion.


Constellation Energy (CEG) is one of the best S&P 500 stocks Friday, up more than 22% at last check, after the utility company said it will acquire independent power producer Calpine for a net purchase price of $26.6 billion. The merger of the two firms will create the nation's largest clean energy provider.
Constellation said it will use 50 million CEG shares priced at the 20-day volume-weighted average price (VWAP) of approximately $237.98 apiece and $4.5 billion in cash to fund the purchase. It will also assume roughly $12.7 billion of Calpine's net debt.
"This acquisition will help us better serve our customers across America, from families to businesses and utilities," said Constellation CEO Joe Dominguez in a statement. "By combining Constellation's unmatched expertise in zero-emission nuclear energy with Calpine's industry-leading, best-in-class, low-carbon natural gas and geothermal generation fleets, we will be able to offer the broadest array of energy products and services available in the industry."

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The transaction is expected to immediately begin boosting Constellation's earnings, with the company projecting an increase of more than 20% to EPS in 2026 and adding at least $2 per share to earnings in future years. It's also expected to add more than $2 billion of free cash flow annually.
The transaction is subject to the customary closing conditions, including regulatory approvals from numerous agencies, Constellation said. If all goes as planned, the transaction is expected to close within 12 months.
Is Constellation Energy stock a buy, sell or hold?
The utility stock was one of the top performers of 2024, ending the year up nearly 93% on a total return basis (price change plus dividends) and it remains a top stock pick this year too. Indeed, Wall Street is overwhelmingly bullish on the large-cap stock.
According to S&P Global Market Intelligence, the consensus recommendation among the 18 covering analysts that it tracks is Buy.
However, analysts' price targets may need to be adjusted following the news of the acquisition. At last check, the average analyst price target of $279 represents a discount of more than 7% to current levels.
Financial services firm UBS Global Research is one of those with a Buy rating on CEG stock, along with a $289 price target.
After rumors of the deal surfaced earlier this week, UBS Global Research analyst William Appicelli said the deal would position Constellation "for a variety of market conditions and have more volumetric upside as power demand grows, as most expect it will in a meaningful manner."
He added that "the addition of a large gas portfolio opens the door for CEG to be more flexible in meeting future large load demand."
Related Content
- Why Walgreens Is the Best S&P 500 Stock After Earnings
- Analysts' Top S&P 500 Stocks to Buy Now
- Stock Picks That Billionaires Love
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
Stock Market Today: Great Power Affairs Mesmerize Markets
The U.S. and China are at least talking about talking about tariffs, and investors, traders and speculators are showing a little less fear.
By David Dittman
-
Is Walmart Plus Worth It?
There are tons of exciting Walmart Plus benefits – but are they worth the $98 annual fee?
By Rachael Green
-
Stock Market Today: Great Power Affairs Mesmerize Markets
The U.S. and China are at least talking about talking about tariffs, and investors, traders and speculators are showing a little less fear.
By David Dittman
-
Three Options for Retirees With Concentrated Stock Positions
If a significant chunk of your portfolio is tied up in a single stock, you'll need to make sure it won't disrupt your retirement and legacy goals. Here's how.
By Evan T. Beach, CFP®, AWMA®
-
Four Reasons It May Be Time to Shop for New Insurance
You may be unhappy with your insurance for any number of reasons, so once you've decided to shop, what is appropriate (or inappropriate) timing?
By Karl Susman, CPCU, LUTCF, CIC, CSFP, CFS, CPIA, AAI-M, PLCS
-
Stock Market Today: Stocks Rise on Good Volatility
Investors, traders and speculators continue to process the "known unknown" of global tariff-and-trade war negotiations.
By David Dittman
-
Before You Invest Like a Politician, Consider This Dilemma
As apps that track congressional stock trading become more popular, investors need to take into consideration some caveats.
By Ryan K. Snover, Investment Adviser Representative
-
How to Put Together Your Personal Net Worth Statement
Now that tax season is over for most of us, it's the perfect time to organize your assets and liabilities to assess your financial wellness.
By Denise McClain, JD, CPA
-
Stock Market Today: Trump Retreats, Markets Rejoice
Stocks rally, yields soften, the dollar rises, and even beaten-down names enjoy the wages of potential trade peace.
By David Dittman
-
Tesla Stock Pops as Elon Musk Promises DOGE Draw Back
Tesla reported a sharp drop in first-quarter earnings and sales, as the EV maker suffered a backlash to its CEO's political ambitions.
By Karee Venema