4 Low-Beta Utility Stocks to Buy Amid Sinking Consumer Confidence

Economic Overview - Consumer confidence in the U.S. has significantly declined, with the Conference Board's consumer survey index dropping to 98.3 in February, below the expected 102.3, marking the lowest level since June 2024 and the largest drop since August 2021 [4] - The University of Michigan Consumer Sentiment Index also fell to 64.7 in February from 71.7 in January, indicating a 15-month low [5] - Inflation has surged, prompting the Federal Reserve to halt its rate cuts, which had previously been reduced by 100 basis points between September and December 2024 [7][8] Utility Stocks Investment - In light of the economic uncertainty, investing in utility stocks is recommended as they are considered defensive. Notable companies include NiSource Inc. (NI), Atmos Energy Corporation (ATO), Southwest Gas Holdings, Inc. (SWX), and Entergy Corporation (ETR), all of which have a Zacks Rank of 1 (Strong Buy) or 2 (Buy) [2] - These utility stocks are characterized by low beta values (greater than 0 but less than 1), making them less volatile compared to the broader market [3] Company-Specific Insights NiSource Inc. (NI) - NiSource serves approximately 3.7 million customers across six states and has a beta of 0.54 with a current dividend yield of 2.80% [10][11] - The expected earnings growth rate for NiSource is 9.1% for the current year, with a Zacks Consensus Estimate improvement of 2.7% over the past 60 days [11] Atmos Energy Corporation (ATO) - Atmos Energy provides natural gas distribution and storage services to nearly 3.4 million customers in eight states, with a beta of 0.72 and a current dividend yield of 2.32% [12][13] - The expected earnings growth rate for Atmos Energy is 5.1% for the current year, with a slight improvement in the Zacks Consensus Estimate [13] Southwest Gas Holdings, Inc. (SWX) - Southwest Gas Holdings operates a regulated utility providing natural gas services, with an expected earnings growth rate of 16.8% for the current year and a beta of 0.44 [14][15] - The Zacks Consensus Estimate for Southwest Gas Holdings has improved by 0.8% over the last 60 days [15] Entergy Corporation (ETR) - Entergy is engaged in electric power production and retail distribution, with a generating capacity of 30,000 megawatts, including over 8,000 megawatts of nuclear capacity [16][17] - The expected earnings growth rate for Entergy is 6.3% for the current year, with a 1% improvement in the Zacks Consensus Estimate over the past 60 days [17]