Analyst price targets
According to Wall Street analysts’ consensus, NextEra Energy (NEE), the most rallied stock among the top utilities, has an upside potential of nearly 5% for the next 12 months. It has a mean price target of $161.9 compared to its current market price of $154.5.
The chart above shows how Wall Street analysts have rated top utilities as of December 26, 2017.
Credit Suisse cut Southern Company’s price target to $51.0 from $52.0 on December 22, 2017.
Lower tax rates aren’t expected to have a noticeable impact on utilities. However, utilities have already witnessed a notable fall, likely driven by their concerning valuations.
US utilities (XLU) continue to look strong fundamentally, considering their earnings growth and balance sheet positions. Their strong earnings growth could facilitate handsome dividend growth over the next few years.
Noted that superior dividend yields, which were key to utilities’ rally in 2017, could continue to be a focal point for investors next year.
To know more, read An Investor’s Guide: A Look at the 10 Largest S&P 500 Utilities.