4 Utility Stocks to Buy as Consumer Confidence Continues to Shrink

Economic Overview - Consumer confidence fell to 94.2 in September, a decline of 3.6 points month over month, missing the consensus estimate of 96 [4] - The Present Situation Index dropped 7 points to 125.4, indicating a negative assessment of current business and labor market conditions [4] - Short-term expectations for income, business conditions, and employment declined to 74.8, with readings below 80 suggesting a higher risk of recession [5] - Concerns over a shrinking labor market have negatively impacted consumer confidence, with job availability assessments declining for nine consecutive months [5] - High prices of goods, exacerbated by tariffs, continue to pressure consumer spending, while inflation remains a concern [6] Investment Recommendations - It is advisable to invest in safe-haven defensive stocks from the utility sector, including Atmos Energy Corporation (ATO), Consolidated Water Co. Ltd. (CWCO), NorthWestern Energy Group, Inc. (NWE), and Northwest Natural Holding Company (NWN), all carrying a Zacks Rank 2 (Buy) [2] - Recommended stocks are categorized as low-beta (beta greater than 0 but less than 1), suggesting a focus on low-beta stocks with high dividend yields and favorable Zacks Ranks [3] Company Profiles - Atmos Energy Corporation (ATO): Engaged in regulated natural gas distribution and storage, serving approximately 3.3 million customers across eight states. Expected earnings growth rate is 7.3% for the current year, with a current dividend yield of 2.05% and a beta of 0.75 [7][8] - Consolidated Water Co. Ltd. (CWCO): Focuses on seawater desalination and water distribution in areas with scarce potable water. Expected earnings growth rate is 0.9% for the current year, with a current dividend yield of 1.60% and a beta of 0.58 [9][10] - NorthWestern Energy Group, Inc. (NWE): Provides reliable energy to customers in Montana, South Dakota, and Nebraska. Expected earnings growth rate is 5.6% for the current year, with a current dividend yield of 4.54% and a beta of 0.40 [11][12] - Northwest Natural Holding Company (NWN): Builds and maintains natural gas distribution systems, serving residential, commercial, and industrial customers. Expected earnings growth rate is 25.3% for the current year, with a current dividend yield of 4.37% and a beta of 0.59 [13][14]