Is PEG (Public Service Enterprise Group Incorporated) Halal or Haram?

Based on our AAOIFI-standard shariah screening, PEG is classified as Doubtful. It passed 3 of 4 compliance screens. Some scholars may permit investing with income purification, while others advise avoiding it. We recommend consulting a qualified Islamic scholar before investing in PEG.

Public Service Enterprise Group Incorporated (PEG) is a major energy company operating primarily in the Northeastern and Mid-Atlantic United States. Through its PSE&G and PSEG Power segments, it transmits electricity, distributes gas to hundreds of thousands of customers, and invests heavily in solar generation and energy efficiency programs. For Muslim investors using AAOIFI standards, PEG currently holds a Doubtful status. While its core utility operations are perfectly halal and it carries negligible interest-bearing cash, the stock unfortunately fails the critical debt screening threshold. The primary concern from an Islamic finance perspective is PEG's heavy reliance on debt financing, a common issue in the capital-intensive utilities sector. Its debt-to-market cap ratio of 61.6% significantly exceeds the 33% limit, making it impermissible to hold under strict AAOIFI guidelines despite a clean 0.00% interest income ratio. Everyday halal investors should avoid PEG for now but can monitor its balance sheet in future quarters. If the company pays down its substantial debt or experiences a significant market cap expansion, it could eventually return to a compliant status. Public Service Enterprise Group Incorporated operates in the Utilities sector under the Regulated Electric industry and is headquartered in Newark, NJ, US. The company is led by CEO Ralph A. LaRossa and employs approximately 13,047 people.

PEG was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. PEG passed 3 of these 4 screens.

PEG was last screened on 2026-04-29. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.