Evergy, Inc. (EVRG): BCG Matrix [Dec-2025 Updated]

You're looking for a clear, no-nonsense breakdown of Evergy, Inc.'s business portfolio as of late 2025, and the BCG Matrix is defintely the right tool to map their strategic position. We've mapped their core regulated utility, which serves 1.7 million customers across Kansas and Missouri and acts as a reliable Cash Cow, against their massive $17.5 billion capital plan focused on grid modernization-a clear Star. Still, the portfolio isn't all clear wins; we're seeing legacy coal assets as Dogs and uncertain, high-potential data center load timing as major Question Marks. Let's dive into where Evergy is pouring its capital and where it needs to be cautious.

Background of Evergy, Inc. (EVRG)

Evergy, Inc. (EVRG) operates as a regulated electric utility, providing service across eastern Kansas and western Missouri. You can think of its major operational components as Evergy Metro, Evergy Kansas Central, Evergy Missouri West, and Evergy Transmission. The utility manages a combined rate base exceeding $20 billion, with roughly half situated in Kansas and the remainder split between Missouri and its interstate transmission assets. Also, Evergy, Inc. holds a significant position as one of the largest wind energy suppliers in the United States.

For the fiscal year 2025, Evergy, Inc. has been executing a substantial capital plan, projecting $17.5 billion in infrastructure investments between 2025 and 2029 to support this growth. The company's long-term outlook is anchored by a goal to achieve an annual adjusted earnings per share (EPS) growth rate of 4% to 6% through 2029, with expectations to hit the upper half of that range starting in 2026, based on a 2025 midpoint estimate of $4.02 per share.

Financially, the company reported first quarter 2025 adjusted EPS of $0.54 per share, the same as the prior year's first quarter, on revenues of $1.37 billion, which was up 3.3% year-over-year. By the third quarter of 2025, the company announced an adjusted EPS of $2.03 per share. Following Q3 results, Evergy, Inc. narrowed its full-year 2025 adjusted EPS guidance to a range of $3.92 to $4.02 per share, citing cooler-than-normal summer weather as a factor.

A key driver for future growth is the expanding economic development pipeline in Evergy, Inc.'s service territories. This pipeline includes significant interest from major technology firms like Google, Panasonic, and Meta, which could represent 800 megawatts of load. As of mid-2025, the active pipeline was described as having 4 to 6 gigawatts of potential load. To support this demand, the company has been advancing regulatory approvals for new generation projects, including modern natural gas plants and solar farms in Kansas.

Reflecting confidence in its regulated earnings recovery and growth strategy, Evergy, Inc. increased its quarterly dividend by 4% to $0.6950 per share as of the third quarter of 2025. As of late October 2025, the company's market capitalization stood at approximately $17.7 billion, with about 230 million shares outstanding.

Evergy, Inc. (EVRG) - BCG Matrix: Stars

Stars are defined by having high market share in a growing market. Evergy, Inc. is positioning its major capital deployment as the engine for maintaining leadership in this high-growth environment, consuming significant cash to secure future market share.

Grid Modernization: Nearly half of the $17.5 billion 2025-2029 capital plan is dedicated to Transmission & Distribution (T&D) upgrades. This focus on the grid is essential to support the massive influx of new, large industrial and data center load. More than 45% of the 2025 spend is specifically earmarked for grid modernization projects.

New Generation for Economic Development: Evergy, Inc. is making substantial investments to serve the potential 11.2 GW of new load stemming from data centers and large industrials in its service territories. This prospective load is significant, as the company's current summer peak system load is about 10.6 GW.

Transmission Infrastructure: Strategic investments are being made in high-growth transmission markets. This includes participation in the Transource Energy joint venture, which supports the necessary backbone infrastructure to connect new generation and serve major economic development wins.

Renewable Generation Build-out: New gas and solar projects are approved to meet the anticipated demand growth. The weather-normalized demand growth forecast through 2029 is 2% to 3%, but this is expected to reach 4% to 5% if the full potential of large customer agreements is realized.

The key investment components supporting these Star initiatives are detailed below:

These investments are designed to capture the high-growth market share driven by economic development. The company has a robust pipeline of potential large load customers, with the 'Tier 1' pipeline alone representing 4.6 GW.

• Total 2025-2029 Capital Plan: $17.5 billion.
• Current Summer Peak System Load: Approximately 10.6 GW.
• Total Large Load Pipeline Being Actively Considered: Roughly 15 GW.
• Long-Term Adjusted EPS Growth Target through 2029: 4% to 6%.
• Specific approved generation additions include 1,840 MW of natural gas and 324 MW of solar projects from settlement agreements.

If Evergy, Inc. sustains this success as the high-growth market for data centers and manufacturing stabilizes, these Stars are positioned to transition into Cash Cows.

Evergy, Inc. (EVRG) - BCG Matrix: Cash Cows

The core regulated utility operations of Evergy, Inc. function as a classic Cash Cow. This segment benefits from a monopoly service territory, providing highly stable and predictable revenue streams to approximately 1.7 million customers across Kansas and Missouri.

The foundation of earnings is the regulated asset base, which, based on the latest available consolidated balance sheet data for the period ended June 30, 2025, shows total assets of $32,911.3 million. This massive asset base, supported by regulatory mechanisms, allows for the recovery of capital investments, which positively contributed to 2025 earnings, with recovery of regulated investments adding $0.11 per share to adjusted EPS in the third quarter alone.

Consistent cash flow generation directly supports the commitment to shareholder returns. Evergy, Inc.'s Board of Directors declared a quarterly dividend of $0.6950 per share, payable on December 19, 2025, representing a 4% increase. This new annualized dividend of approximately $2.78 per share aligns with the company's long-term target of distributing between 60% and 70% of adjusted Earnings Per Share (EPS). The reported payout ratio based on adjusted earnings for the year-to-date period was 72.2%, while the payout ratio based on Free Cash Flow was 100%.

Because the market is mature and regulated, growth investment is focused on efficiency and infrastructure support rather than aggressive market share expansion. The company has outlined a $17.5 billion five-year capital program, which projects approximately 8.5% rate-base growth through 2029. Regulatory mechanisms like PISA (Power Infrastructure Siting Act) and CWIP (Construction Work in Progress) are key tools used to support this investment and mitigate regulatory lag, ensuring the cash cow continues to generate returns.

Here are key financial metrics that underscore the stability of this segment as of the third quarter of 2025:

The stability is further evidenced by the long-term outlook, which is based on the 2025 adjusted EPS guidance midpoint of $4.02, with a reaffirmed long-term adjusted EPS annual growth target of 4% to 6% through 2029. The company views the large economic development pipeline in Kansas and Missouri as a tailwind supporting this regulated growth.

The focus for management within this quadrant involves maintaining operational excellence and securing regulatory approvals to support required infrastructure investments. Key regulatory actions cited include the expected imminent decision on a unanimous LLPS settlement in Kansas and a Missouri LLPS order by year-end 2025.

• Monopoly service area in Kansas and Missouri.
• Customer count of approximately 1.7 million.
• Long-term adjusted EPS growth target of 4% to 6% through 2029.
• Five-year capital investment plan of $17.5 billion.
• Quarterly dividend of $0.6950 per share as of late 2025.

Evergy, Inc. (EVRG) - BCG Matrix: Dogs

Dogs are business units or products with a low market share in low growth markets. These units frequently break even, tying up capital without generating significant returns. For Evergy, Inc. (EVRG), assets requiring significant capital for maintenance or facing mandated phase-outs, alongside non-core, lower-margin activities, fit this profile.

Aging Coal-Fired Generation: Plans to retire over 4,500 MW of coal capacity over the next 20 years, signaling a phase-out of this high-cost asset.

The utility's historical reliance on coal, which constituted about 38% of total capacity as of late 2023, is a key area of strategic divestiture, as these assets are high-cost and face regulatory obsolescence. The 2024 Integrated Resource Plan (IRP) outlined a commitment to retire more than 4,500 MW of coal-based generation over the subsequent two decades. However, recent 2025 IRP updates show extensions for some units, indicating the phase-out is not linear and requires ongoing cash management for upkeep or conversion.

Specific coal retirement schedule adjustments noted in the 2025 filings include:

• Lawrence Energy Center coal retirement delayed from 2028 to 2032.
• A 480 MW coal plant retirement in Kansas Central delayed to 2032.
• A 375 MW retirement in Evergy Metro delayed from 2032 to 2033.
• Missouri West delayed 59 MW of retirement from 2031 from 2032.

The prior plan from 2021 aimed to remove 487 MW from the Lawrence Energy Center by the end of 2023, showing the current state is a result of backtracking on the most aggressive phase-out timelines. Instead of outright retirement, some units, like Jeffrey Energy Center and Lawrence Energy Center, are planned for conversion to natural gas plants, which still requires significant capital outlay for a non-growth asset class.

Unregulated Energy Marketing: A non-core business segment that S&P Global noted modestly weakens the overall business risk profile.

This segment, housed within Evergy Kansas Central, is explicitly noted as a factor that modestly weakens the company's business risk profile assessment. While the regulated utility operations form the core, this non-regulated marketing arm introduces volatility and is not central to the long-term, stable cash flow model. The 2025 earnings reports excluded costs from non-regulated energy marketing margins related to the February 2021 winter event when calculating adjusted earnings, underscoring its non-recurring or volatile nature.

Legacy Industrial Load: Industrial sales showed weakness in Q1 2025, with weather-normalized demand declining by 3.0% in that segment.

The industrial customer segment, typically a driver of stable, high-volume sales, showed significant softness in the first quarter of 2025. While total retail demand grew by 2.7% year-over-year, the weather-normalized total retail demand actually declined by 3.0%. The industrial category was the primary drag, showing a concerning weather-normalized decrease of 8.4% in Q1 2025, partially attributed to an unplanned maintenance shutdown at a large customer facility. Management noted this weakness was a partial offset to regulated investment recovery in the quarter.

Here's a snapshot of the quantitative data associated with these lower-performing areas as of the latest reporting periods:

These units and segments are candidates for divestiture or aggressive minimization because they consume management focus and capital without providing commensurate growth. If onboarding takes 14+ days, churn risk rises, and similarly, if expensive turn-around plans for these assets don't yield immediate cash flow improvement, they should be minimized. Finance: draft 13-week cash view by Friday.

Evergy, Inc. (EVRG) - BCG Matrix: Question Marks

Question Marks represent business areas within Evergy, Inc. that operate in high-growth markets but currently hold a low market share. These units consume substantial cash due to necessary investment to capture market share but yield low immediate returns. The strategic imperative here is rapid market share gain or divestiture.

Utility-Scale Solar Portfolio

The utility-scale solar segment is a high-growth market, but Evergy, Inc.'s current operational footprint is relatively small compared to its future plans, positioning it squarely as a Question Mark. As of 2024, the total solar portfolio stood at just over 45 megawatts. The company is actively seeking to shift this, with plans to be involved in the construction of additional solar projects totaling approximately 450 megawatts during 2025 and 2026. This aggressive build-out is necessary to compete in the growing renewable energy sector.

The pipeline for solar additions, as detailed in resource plans, shows a significant ramp-up intended to meet future demand:

• Addition of 600 MW of solar energy planned for 2027.
• Addition of 450 MW of solar energy planned for 2028.
• Specific approved projects include a 107-MW solar facility in Missouri and a 75-MW facility in Kansas.

Here's a quick look at the planned solar capacity additions:

Early-Stage Venture Investments

Evergy, Inc.'s non-regulated investments in early-stage clean energy and energy solution companies are consuming resources without providing stable returns, evidenced by significant write-downs. The company has initiated a process to dispose of this portfolio.

The financial impact for the year 2025 is clear:

• Impairment losses year to date September 30, 2025, totaled $29.0 million.
• The losses for the three months ended and year to date June 30, 2025, were $29.0 million pre-tax.
• In the second quarter of 2025, losses related to these investments were approximately $0.08 per share.

New Natural Gas Plants

The commitment to two new combined-cycle natural gas plants in Kansas represents a massive capital outlay for future capacity, which is currently a drain until they become operational. These projects are designed to support reliability as the company transitions its fleet. Each plant is 705 MW.

Key financial and timeline details for these investments include:

• The Sumner County plant is expected to be in service in 2029.
• The Reno County plant is expected to be in service in 2030.
• The total construction cost for the two plants is 'more than $2 billion'.
• Each plant is expected to create more than 500 jobs during construction.
• Post a 10-year tax exemption, each plant is projected to provide over $500 million in property tax revenues over its service life.

Load Growth Timing

The massive potential load from new data centers and industrial customers creates a high-growth market, but the actual revenue realization is timed for the future, making the current investment a Question Mark. Evergy, Inc.'s current summer peak across its system is about 10.6 gigawatts. The economic development pipeline, however, represents about 11.2 gigawatts of prospective new load, which grew to approximately 12.2 gigawatts (GW) as of Q1 2025.

The immediate, concrete demand from large customers is substantial:

• Five large announced projects, including data centers from Google and Meta, represent about 800 megawatts of new demand.
• Data center projects in the 'finalizing agreements' category represent approximately 600 MW of incremental opportunity through 2029.
• The 2025 Integrated Resource Plan calls for adding 1,860 MW of natural gas-fired resources by 2030 to help meet this demand.

If you look at the pipeline, the potential is huge, but the timing is key. Finance: draft 13-week cash view by Friday.