BTC iShares U.S. Utilities ETF
Why Utilities Could Keep Smashing in the Fourth Quarter
Despite valuation concerns, utility stocks seem relatively well placed at the moment, especially going into October, compared to broader markets.
Utility Stocks: What to Expect in the Future
Utility stocks have outperformed broader markets. Over the past 12 months, utilities (XLU) have returned 19% including dividends, while the S&P 500 has returned 9%.
How Utilities’ Returns Compare with Broader Markets’
Utility stocks, generally seen as bond substitutes due to their stable dividends, have rallied significantly.
Comparing Utility Stocks and Treasury Yields
The benchmark ten-year Treasury yields closed at 2.5% last week. Treasury yields and utility stocks usually trade inversely to each other.
XLU: What Utilities’ Chart Indicators and Short Interests Mean
The Utilities Select Sector ETF (XLU) briefly crossed ~$59.0 last week and then came down.
Utilities Beat Broader Markets in the Long Term
Utilities have been an effective hedge against market uncertainty. They have also beaten broader markets in the longer term.
XLU’s Chart Indicators and Short Interest
Currently, the Utilities Select Sector SPDR ETF (XLU) is trading at $58.2 after hitting an all-time high of $58.7 last week.
AEP, EXC, and Other Utilities: Analysts’ Views and Price Targets
In this series, we’ll take a look at what Wall Street analysts currently think of some of the big utility names.
Analyzing the Valuations of the Top-Performing Utility Stocks
All the stocks under consideration in this series are currently trading at their respective multiyear highs.
A Look at the Market Performances of the Top-Performing Utilities
NextEra Energy (NEE), NiSource (NI), and CMS Energy (CMS) have beaten their peers as well as the broader markets in terms of total returns in the last five years.
XLU: How Utilities Fared against Broader Markets Recently
Utilities notably outperformed broader markets over the past 12 months.
FirstEnergy’s Valuation Compared to Its Peers
FirstEnergy (FE) stock was one of the top performers among utilities last year. In the last 12 months, the stock has risen ~25%.
FE, AEP, and EXC: Analyzing Utilities’ Current Valuation
FirstEnergy (FE) stock looks to be trading at an attractive valuation, considering its lower valuation multiple against its historical average and peers’ averages.
PPL, SRE, and XEL: Analyzing Utilities’ Current Valuation
PPL (PPL) is trading at a forward PE ratio of 13x based on analysts’ EPS estimates for 2019. PPL appears to be trading at a discounted valuation.
Duke Energy: Who Added Big Positions in Q4?
Most of the top institutional investors increased their existing holdings in Duke Energy (DUK)—the largest regulated utility in the country.
FirstEnergy Stock: What Can Investors Expect?
FirstEnergy (FE) stock is trading close to its 52-week high. The stock continues to look strong based on its simple moving average levels.
Duke Energy: What Analysts Expect from Its Q4 Earnings
Duke Energy (DUK), the second-largest utility by market cap, is scheduled to report its fourth-quarter and fiscal 2018 earnings on February 14.
Sempra Energy and Edison International’s Current Valuations
Sempra Energy is currently trading at a forward PE ratio above 19x based on analysts’ earnings estimates for the next 12 months.
PG&E Files for Chapter 11 Bankruptcy, Stock Rises 5%
On January 29, wildfire-stricken PG&E filed for voluntary Chapter 11 bankruptcy protection. The utility faces ~$30 billion in potential liabilities.
Comparing Utilities and Treasury Yields
The benchmark ten-year Treasury yield trended lower and changed from 2.68% to 2.66% last week.
Utilities versus Broader Markets’ Total Returns
Utilities played out well last year amid broader markets’ volatility. They returned more than 6%, while the S&P 500 returned -6% last year.
Utilities Beat Broader Markets: Total Returns in 2018
Utilities have outperformed broader markets in 2018. Including dividends, broader utilities have returned ~6%, while SPY has returned -8% YTD.
The Top Ten S&P 500 Utility Stocks by Market Capitalization
The Utilities Select Sector SPDR ETF (XLU), which represents S&P 500 utilities, hit a 52-week high of $56.80 on December 4.
Dominion Energy Has Attractive Dividend Profile
Dominion Energy (D), the third largest utility stock by market cap in the country, is currently trading at a dividend yield of 4.5%, notably higher than the broader utilities’ average.
How Institutional Investors Played XLU in Q3 2018
Utilities at large are up almost 3% so far this year, marginally outperforming broader markets. Investors turned to the relatively safe utilities lately amid trade war tensions and a recent broad-market selloff.
Southern Company Beats Q3 Estimates, Maintains Vogtle Schedule
Southern Company (SO), the fourth-biggest utility by market capitalization, released its third-quarter earnings on November 7.
Duke Energy Beats Q3 Earnings Estimates and Raises Guidance
Duke Energy (DUK), the second-largest utility by market cap, reported its third-quarter earnings today.
What to Expect from Southern Company’s Q3 Revenues
Southern Company (SO), one of the largest regulated utilities, is expected to report its third-quarter results on November 7.
Utilities’ Returns Compared to Other Sectors in 2018
Utilities (XLU) have returned more than 5% and have outperformed broader markets in 2018.
GE’s Second-Quarter Results: No Break from GE Power’s Underplay
The Power segment’s revenues declined 19% in the second quarter to $7.5 billion from $9.4 billion in the same period in 2017.
What PPL’s Latest Chart Indicators and Short Interest Suggest
PPL reported better-than-expected earnings in the second quarter. The company’s earnings grew 6% compared to the same period last year.
Who Added Big Positions in NextEra Energy in Q2 2018?
The Vanguard Group is the largest institutional investor in renewables titan NextEra Energy (NEE).
Utilities: What If Jamie Dimon’s Forecast Comes True?
Last week, Jamie Dimon said that investors should be prepared to deal with ten-year Treasury yields reaching 5% or higher.
NRG Energy’s Revenue Grows, EPS Fall in Q2 2018
NRG Energy (NRG), which saw the largest stock rally among utilities last year, reported its second-quarter financial results today.
Duke Energy’s Q2 2018 Profit Sinks as Expenses Rise
Duke Energy (DUK), the second largest utility by market cap, reported its second-quarter earnings results on August 2.
FirstEnergy Reported Higher Q2 2018 Earnings Due to the Weather
FirstEnergy reported its second-quarter financial results on July 31 after the markets closed. The company reported an adjusted EPS of $0.62.
Here’s What Could Drive Xcel Energy’s Q2 2018 Earnings
Xcel Energy (XEL) is set to report its Q2 2018 results on July 26. Analysts expect EPS of $0.47 compared to $0.45 in 2Q 2017.
Where PPL Stock Might Go from Here
PPL Corporation (PPL) stock has rallied more than 11% in the last month, outperforming utilities at large.
Wall Street Analysts’ Top Five Favorite S&P 500 Utilities Stocks
Utility stocks remained strong even after the Fed delivered a rate hike last month—the second rate hike in 2018.
What Could Drive Duke Energy’s Dividends
Duke Energy’s (DUK) earnings in the longer term seem well placed, which might enable the targeted 4%–6% dividend growth in the next few years.
How PPL’s Dividend Yield Stands against Its Peers
PPL Corporation (PPL) is currently trading at a dividend yield of 5.7%, one of the highest in the sector.
SCANA Cut Dividends 80%, Stock Rose 5%
For the second quarter, SCANA will pay a dividend of $0.124 per share to shareholders of record on July 10.
How Capacity Utilization across US Industries Trended in May
The total industry capacity utilization in May has fallen from the upward revised April reading of 78.1 to 77.9 in May.
How Analysts Currently Rate Dominion Energy Stock
Based on analysts’ 12-month mean target price of $72.10, Dominion Energy (D) stock has an upside of ~12% to its current market price of $64.
Trends in Capacity Utilization across US Industries in April
According to the Fed’s industrial production and capacity utilization report, capacity utilization increased from 77.6% in March to 78% in April.
Institutional Investors: How They Played S&P 500 Utilities in Q1
Utility stocks—generally called widow and orphan stocks—are one of the poorest performing sectors of the broader markets so far this year.
PEG Stock Compared to Its Peers in the Past Year
Among the 14 analysts covering PEG, three recommend it as a “strong buy,” six recommend it as a “buy,” and five recommend it as a “hold.”
AEP Stock: What to Expect in 2018
According to analysts, American Electric Power stock has a mean target price of $73.66—compared to its current market price of $66.27.
Will Southern Company’s Higher 1Q18 Earnings Lift Its Stock?
The Atlanta-based second-largest regulated utility company, Southern Company (SO), reported its 1Q18 earnings today.
Comparing NRG Energy’s Valuation to Its Peers
Currently, NRG Energy (NRG) is trading at an EV-to-EBITDA valuation of ~12x—compared to its five-year historical average valuation of 11x.
NextEra Energy Beat 1Q18 Earnings Estimates
NextEra Energy (NEE), the biggest utility by market capitalization in the country, reported its1Q18 earnings on April 24.
What March Capacity Utilization Data Says about Economy
The total industry capacity utilization in March increased from 77.7% in February to 78.0% in February.
Why Rising Treasury Yields Could Be Bad News for Utility Stocks
The ten-year Treasury yield has risen significantly this year and peaked at 3.0% last week, its highest level in the last four years.
Where Dominion Energy Stock Might Go from Here
Dominion Energy (D) stock continues to look weak in the near future considering its moving averages.
Dominion Energy Fell to a 52-Week Low
There hasn’t been any respite for Dominion Energy (D) investors. The stock has corrected almost 20% YTD.
XLU: How Interest Rates Affect Utilities
The ten-year Treasury yield witnessed a notable drop late last week due to the trade clashes between China and the United States.
February’s Capacity Utilization Trends across US Industries
According to the Federal Reserve, total industry capacity utilization increased 1.3% from 77.4% in January 2018 to 78.1% in February.
How Utilities’ Total Returns Compare to Broader Market Sectors
The Utilities Select Sector SPDR ETF (XLU) returned more than 1%, while broader markets returned 18% in the last one year.
Dominion Energy Stock Dives to a 52-Week Low
On March 15, 2018, Dominion Energy stock fell to $70.9—a new 52-week low. Dominion Energy stock entered the “oversold” zone with its RSI at 29.
Analyzing Wall Street’s Top 5 S&P 500 Utilities Stocks
After correcting more than 12% in the last three months, US utilities continue to look weak,
NRG Energy’s Loss Widened in 2017, Stock Soared 4%
NRG Energy (NRG) reported its 4Q17 and fiscal 2017 earnings on March 1, 2018. The company reported adjusted earnings of $0.25 per share.
What’s Expected to Drive Xcel Energy’s Dividends
Dividend outlook Let’s discuss what could affect Xcel Energy’s (XEL) dividends. Xcel Energy aims to increase its long-term per-share earnings by 5%–6%, bringing its targeted per-share dividend growth to similar levels. Xcel Energy’s increased focus on expanding its renewables capacity and multiyear rate plans could boost its earnings over a longer term. Xcel Energy is planning to invest ~$20 […]
How Xcel Energy’s Payout Ratio Stacks Up
Xcel Energy’s dividend statistics Let’s take a look at Xcel Energy’s (XEL) dividend profile. The company, which has raised its dividends in the last 15 consecutive years, had a payout ratio of 63% in 2017. Payout ratios represent how much of companies’ profits are distributed to shareholders in the form of dividends. Utilities pay a large portion […]
Institutional Investment in PEG in 4Q17
The Vanguard Group added net 0.46 million shares of Public Service Enterprise Group (PEG) in 4Q17.
NextEra Energy’s Dividend Outlook and Growth Prospects
In the last one-year period, NEE’s total returns came in at 27.0%.
Institutional Investment in XLU during 4Q17
UBS Financial Services is the biggest institutional investor in XLU. UBS held 11.66 million shares of XLU as of December 31, 2017.
How Treasury Yields Weighed on Utilities
US utilities were trading at a dividend yield premium of ~180 basis points–200 basis points to benchmark Treasury yields during mid-2017.
What Drove Industrial Production Lower in January 2018?
The Federal Reserve’s report indicated that industrial production fell 0.1% in January as compared to a 0.9% increase in December.
PG&E’s Recent Implied Volatility Trends
PG&E has witnessed immense volatility in the last few months. On February 9, the implied volatility was ~40%—higher than its 15-day average.
Duke Energy’s Dividend Outlook and Growth Prospects
Duke Energy’s (DUK) earnings in the longer term seem well placed, which might facilitate the targeted 4%–6% dividend growth.
Duke Energy and Southern Company’s Current Valuations
Top utility stocks Duke Energy (DUK) and Southern Company (SO) are trading at an EV-to-EBITDA valuation multiple of 11.4x and 10.5, respectively.
S&P 500 Utilities at a 52-Week Low Offer a Big Gain Potential
US utilities have been trading weak for the last few months. The Utilities Select Sector SPDR ETF (XLU) hit its 52-week low of $47.37 on February 6, 2018.
How Are Top Utility Stocks Valued Right Now?
The biggest constituent of the SPX Utilities, NextEra Energy (NEE) is trading at a valuation multiple beyond 14x—higher than its historical average.
Does Dominion Energy’s Deal with SCANA Look Uncertain?
Dominion Energy agreed to buy troubled SCANA for $7.9 billion in a stock-for-stock deal in January this year.
Looking at Xcel Energy’s Moving Averages and Short Interest
Though it was one of the top-rallying stocks of the last year, Xcel Energy (XEL) currently seems weak considering its moving average levels.
XLU: Analyzing Utilities’ Chart Indicators
On January 26, 2018, the Utilities Select Sector SPDR ETF (XLU) was trading 4% and 5% below its 50-day and 200-day moving average levels.
What Drove NextEra Energy’s 4Q17 Revenues?
NextEra Energy (NEE) reported its 4Q17 financial results on January 26, 2018. NextEra Energy reported total operating revenues of $4.01 billion for 4Q17.
California Water’s Long Dividend Payment History
The San Jose–based California Water Service Group (CWT) is currently trading at a dividend yield of 1.6%. It has increased its per-share dividends for the past 50 consecutive years.
What Differentiates Northwest Natural Gas from Top Utility Stocks
In this series, we’re analyzing dividend profiles for utilities that have increased their dividends for more than consecutive 40 years.
American Electric Power’s Total Returns Compared to Its Peers
In the last year, American Electric Power returned 21%—compared to broader utilities’ average returns of ~11%. During the same period, SPY returned 22%.
Duke Energy Stock Is at Its Most Oversold Level in 5 Years
The second-largest utility by market cap, Duke Energy (DUK), has been on a downtrend in 2018. In the last month, DUK has fallen nearly 12%.
What’s NRG Energy’s Current Valuation?
NRG Energy (NRG) stock was trading at an EV-to-EBITDA valuation of 13x—higher than its five-year historical valuation.
Where NRG Energy Stock Might Go from Here
NRG Energy (NRG) stock was one of the top gainers among the S&P 500 last year. So far in 2018, it has lost more than 5%.
Assessing NextEra Energy’s 4Q17 Earnings and Growth Prospects
According to analysts’ estimates, NextEra Energy (NEE) will report EPS (earnings per share) of $1.31 for the quarter ended December 31, 2017.
What Makes AES’s Dividend Profile Attractive?
AES Corporation (AES) declared a per share dividend of $0.13 last month.
How Does Southern Company’s Dividend Profile Look?
Georgia-based Southern Company (SO) currently offers a dividend yield of 5.2%, the highest among top SPX utilities.
How Are Utilities’ Dividend Yields and Valuations Trending?
Utilities’ dividend yields have started looking even more attractive after their recent fall.
How Utility Stock Movements Compare with Treasury Yields
Treasury yields (TLT) rose significantly last week on stronger-than-expected inflation data for December 2017.
Southern Company Fell to 2-Year Low on Goldman Sachs Downgrade
Southern Company stock has shown tremendous weakness recently with a fall of over 12% in the last one month. Broader utilities (XLU) (IDU) fell 10% in the same period.
Dominion Energy or Sempra: Recent Smart Deals
Sempra Energy (SRE) has a mean target price of $121.9—compared to its current market price of $107.2. It shows an upside potential of 14% going forward.
Exelon Offers a Decent Potential Upside from Here
The stock of Exelon Corporation (EXC), the largest hybrid utility and the largest utility by revenue, has a mean price target of $43.2.
Will NRG Energy Stock Replicate Its 2017 Movements This Year?
Given its rise of more than 130% last year, NRG Energy (NRG), the largest merchant power stock, holds the top spot among the most rallied utility stocks.
Analyzing AES’s Latest Valuation, Analyst Views, and More
The most globally diversified utility, AES Corporation (AES), has a potential upside of more than 18% over the next 12 months.
Looking at FirstEnergy’s Price Targets and Analyst Views
According to analysts’ consensus, FirstEnergy stock has a mean price target of $36.2, which indicates an implied gain of 19% over the next 12 months.
Is PG&E’s Huge Upside Potential Worthy of the Risks?
According to Wall Street analysts’ consensus, PG&E Corporation (PCG) has a mean price target of $55.3 compared to its current market price of $45.2.
Analyzing Duke Energy’s Dividend Yield
Duke Energy (DUK) is one of the top-yielding utilities in the S&P 500 Utilities Index (XLU). Currently, it’s trading at a dividend yield of 4.0%.
SCG: Analyzing SCANA’s Current Valuation
SCANA (SCG) stock is currently trading at a significant discount relative to peers. On December 22, it was trading at an EV-to-EBITDA valuation multiple below 8x.
PG&E Stock Trading in Deep Oversold Zone
PG&E (PCG) stock was leading the broader utilities prior to the fires in California.
PPL Stock: How It’s Valued Compared to Peers
On December 19, PPL stock was trading at an EV-to-EBITDA multiple near 10.5x. Its five-year historical average and industry average multiples are near 11x.
XLU: Analyzing Utilities’ Current Valuations
Historically, utilities’ price-to-earnings multiples have been ~14.0x–15.0x. However, they are currently trading close to 20.0x.