Core Insights - Listed infrastructure underperformed global equities in Q4, despite two cuts in short-term rates in the U.S., due to higher long-term bond yields and a prevailing higher-for-longer sentiment [3] - European utilities outperformed U.S. utilities, aided by improving regulations, while renewables benefited from their increasing relevance in AI and policy derisking [3] Sector Performance - Underperforming sectors included natural gas utilities, energy infrastructure pipelines, communication towers, and North American rails, primarily due to higher production levels and adverse weather forecasts for natural gas [4] - Electric utilities, particularly in Western Europe, were the top contributors, with SSE and Iberdrola leading the performance [5][6][7] Company Highlights - SSE, the largest renewable energy generator in the U.K., saw its share price rise as funding risks diminished and macroeconomic concerns eased [6] - Iberdrola, a multinational integrated electric utility, raised guidance during its third-quarter results, reflecting strong operational performance [7] - OGE Energy and Redeia were the largest detractors, with OGE facing delays in a data center deal and Redeia impacted by negative sentiment from a regulatory review [8][9] Outlook - The outlook for listed infrastructure remains positive, with expectations of continued performance driven by inflection in electricity demand and solid earnings growth, supported by lower nominal bond yields [10] - Electric utilities are benefiting from several tailwinds, including the energy transition, climate change adaptation, and growing electricity demand from AI data centers and industrial sectors [11] Portfolio Highlights - The strategy saw positive contributions from eight out of ten sectors, with electric and water utilities being the top contributors, while energy infrastructure and communications were detractors [13] - The strategy outperformed relative to the FTSE Global Core Infrastructure 50/50, driven by stock selection in electric, water, and gas utility sectors, along with a renewables overweight [14] - Top contributors to absolute returns included SSE, Iberdrola, Enel, NextEra Energy, and Clearway Energy, while detractors included OGE Energy, Redeia, WEC Energy, Enbridge, and Crown Castle [15] Investment Activity - New positions were initiated in U.S. electric utilities Portland General Electric and Edison International, as well as French utility Engie and Brazilian utility Axia Energia, while positions in CPFL Energia, Crown Castle, and WEC Energy were exited [16]

Core Insights - Ameren Corporation's operations in Missouri and Illinois generate over $20.7 billion in annual economic output according to a study by HR&A Advisors [1][2] Economic Impact - The study highlights that every dollar and job related to Ameren's operations generates additional leading-wage jobs, disposable income, and increased tax revenue for communities in the bi-state region [2][3] - Ameren's annual efforts to manage costs and streamline operational efficiency help mitigate the impact of rising energy costs, increasing spending power for residential and business customers [3] Job Creation and Investments - Technical assistance from Ameren led to the creation of 3,728 new jobs in 2025, with 73 economic development projects triggering $3.56 billion in capital investment [4] - In 2025, businesses in Ameren Missouri's service territory created 2,273 new jobs and invested $1.56 billion, while those in Ameren Illinois' territory created over 1,455 new jobs and invested $2 billion [4] Financial Contributions - Ameren supports 55,200 jobs through its annual economic activity and purchased $2.2 billion from in-state suppliers in Missouri and Illinois [6] - The company contributed $920 million in taxes to state and local governments and provided $10.6 million in philanthropic support for community needs [6] Recognition - Ameren was recognized as one of Business Facilities magazine's 2026 Top Utilities for Economic Development [5]

Core Viewpoint - Duke Energy's Florida unit announced that the storm cost recovery charge will be removed from customer bills one month earlier than initially planned [1] Group 1 - The removal of the storm cost recovery charge indicates a positive adjustment for customers, potentially improving customer satisfaction and financial relief [1]

Core Viewpoint - Duke Energy Florida will remove the storm cost recovery charge from customer bills a month earlier than scheduled due to the successful recovery of costs associated with hurricanes Debby, Helene, and Milton, totaling approximately $1.1 billion [1][2]. Financial Impact on Customers - Residential customers will see a reduction of approximately $33 on their monthly bills starting in February, with an additional decrease of about $11 in March, leading to a total reduction of $44 compared to January [5][7]. - Commercial and industrial customers will experience bill reductions ranging from 9.6% to 15.8%, depending on various factors [6]. Energy Savings Initiatives - Duke Energy Florida has implemented efficiency improvements at its natural gas plants, resulting in $340 million in fuel cost savings, translating to $10 savings on monthly bills [7]. - The company has completed three new solar energy sites, saving customers an additional $750 million from displaced fuel costs [7]. - Customers will benefit from $65 million in tax credits from the Inflation Reduction Act, saving residential customers at least $2.50 per 1,000 kWh [7]. Company Overview - Duke Energy Florida, a subsidiary of Duke Energy, has an energy capacity of 12,300 megawatts and serves 2 million customers across a 13,000-square-mile area in Florida [4]. - Duke Energy is one of America's largest energy holding companies, serving 8.4 million customers across multiple states and owning a total capacity of 54,800 megawatts [8].

Company Overview - Entergy Corporation, based in New Orleans, LA, is primarily engaged in electric power production and retail distribution, with a generating capacity of 25,000 megawatts (MW), including over 5,000 MW from nuclear fuel [11] - The company distributes electricity to approximately 3 million customers across Arkansas, Louisiana, Mississippi, and Texas, with a generation mix of 42% from Cycle Combustion Turbine and Combined Cycle Gas Turbine units, 10% legacy gas, 27% nuclear power, 3% coal, and 2% renewables [11] Investment Ratings - Entergy Corporation holds a Zacks Rank of 3 (Hold) and has a VGM Score of B, indicating a moderate investment outlook [12] - The company has a Momentum Style Score of B, with shares increasing by 1.7% over the past four weeks [12] Earnings Estimates - Two analysts have revised their earnings estimates higher for fiscal 2025, with the Zacks Consensus Estimate increasing by $0.01 to $3.91 per share [12] - Entergy has an average earnings surprise of +14.3%, suggesting a positive trend in earnings performance [12] Investment Consideration - With a solid Zacks Rank and strong Momentum and VGM Style Scores, Entergy Corporation is recommended for investors' consideration [13]

Core Insights - The investment landscape in 2026 is influenced by themes from 2025, including AI optimism, Federal Reserve policies, geopolitical tensions, and tariff risks [1] Sales Growth as an Indicator - Sales growth is a reliable metric for evaluating stocks, reflecting actual demand and underlying company momentum, unlike earnings which can be influenced by accounting practices [3] - Consistent sales growth indicates potential market share expansion and successful entry into new markets, serving as an early indicator of earnings upside and long-term value creation [3] Contextual Analysis of Sales Performance - Sales performance should be contextualized against peers, industry trends, and economic conditions to identify companies with durable growth and competitive advantages [4] - Durable growth supports predictable cash flows, allowing management to reinvest and maintain balance sheet strength without excessive debt [4] Stock Selection Criteria - Stocks are shortlisted based on criteria including 5-Year Historical Sales Growth greater than industry average and Cash Flow exceeding $500 million [5] - Additional metrics include a Price/Sales (P/S) Ratio lower than industry average, positive changes in sales estimate revisions, operating margins above 5%, and Return on Equity (ROE) greater than 5% [6][7][8] Highlighted Stocks for 2026 - MKS Inc. (MKSI), Ameren Corporation (AEE), and ONE Gas, Inc. (OGS) are identified for their robust sales growth and strong financial fundamentals [10] - MKSI expects a sales growth of 6.9% in 2026, AEE projects 7.2%, and OGS forecasts a 5% increase, all while maintaining high cash flow and solid operating margins [10][11][12][13]

Group 1 - The 2.8% Social Security cost-of-living adjustment (COLA) is insufficient for retirees as it does not keep pace with inflation in essential spending categories like healthcare and groceries [2][7] - Walmart's 30% stock gain indicates strong pricing power in grocery essentials, highlighting the disparity between national inflation averages and the actual cost pressures faced by fixed-income households [3][7] - Utility companies and healthcare providers are raising rates, which disproportionately affects fixed-income households, as they cannot easily reduce spending on these necessities [4][7] Group 2 - Dividend income for retirees is not keeping pace with inflation; AT&T's 4.5% yield has remained stagnant for four years, while Duke Energy's dividend growth is only 1.9% annually [5][7] - The choice for retirees is between locking in stagnant high-yield dividends or accepting lower starting yields from companies with better growth prospects, indicating a challenging investment environment [5][6] - A focus on sustainable growth rather than high starting yields is emphasized by dividend investors, suggesting that payout ratios are more critical than yield alone [6]

Core Viewpoint - Eversource Energy is a public utility holding company with a market cap of $25.7 billion, engaged in energy delivery across Connecticut, Massachusetts, and New Hampshire, and is expected to announce its fiscal Q4 2025 results soon [1] Financial Performance - Analysts anticipate Eversource to report an adjusted EPS of $1.19 for Q4 2025, reflecting a 17.8% increase from $1.01 in the same quarter last year [2] - For fiscal 2025, the expected adjusted EPS is $4.75, a rise of 3.9% from $4.57 in fiscal 2024, with projections of 4.8% growth year-over-year to $4.98 in fiscal 2026 [3] Stock Performance - Eversource Energy's stock has increased by 22.5% over the past 52 weeks, outperforming the S&P 500 Index's gain of 19.3% and the State Street Utilities Select Sector SPDR ETF's increase of 14.7% during the same period [4] Recent Developments - Despite reporting better-than-expected Q3 2025 adjusted EPS of $1.19, Eversource's shares fell by 1.2% the following day due to a $75 million charge related to increased liability from previously sold offshore wind projects, indicating ongoing risks in its clean-energy transition [5] Analyst Ratings - The consensus rating for Eversource Energy stock is cautious, with a "Hold" rating overall; among 16 analysts, there are five "Strong Buys," eight "Holds," one "Moderate Sell," and two "Strong Sells," with an average price target of $72.92, suggesting a potential upside of 6.6% from current levels [6]

Group 1 - The overall water inflow in the Yangtze and Pearl River basins is favorable for Q4 and the entire year, with electricity generation expected to increase significantly [1][2] - The Yangtze River's electricity generation is projected to reach 3,071.94 billion kWh in 2025, a year-on-year increase of 3.82%, with Q4 generation at 720.68 billion kWh, up 19.9% year-on-year [2] - The Pearl River basin has also seen a strong performance, with Guiguan Power's Q4 hydropower generation increasing by 79.1% year-on-year, contributing to an annual total of 415.68 billion kWh, a record high [2] Group 2 - The Yarlung Tsangpo River's water inflow is below average, leading to reduced electricity generation, with projected generation declines of 40.6%, 35.2%, and 7.2% for the months of October to December [2] - The Dadu River is also expected to see a decrease in generation, with a projected annual output of 448.81 billion kWh, down 7.5% year-on-year [2] - Overall, while the Yangtze and Pearl River basins show strong performance, the Yarlung Tsangpo and Dadu Rivers are lagging behind [2] Group 3 - The end-of-year energy storage levels are high, ensuring electricity generation during the dry season, with the Longtan Power Station achieving full capacity for the first time since 2021 [3] - The Yangtze River's energy storage is also robust, with a total of 345.28 billion kWh stored, an increase of 33.40 billion kWh year-on-year [3] - The impact of drought conditions on energy generation has been largely mitigated [3] Group 4 - The hydropower sector is entering a new peak of production, with several new projects coming online, including those from Guiguan Power, which is set to acquire assets from Datang Group [4] - The long-term interest rates remain low, which is expected to reduce funding costs and enhance valuations for companies like Yangtze Power, which has a current dividend yield of approximately 3.6% [4] - The environment of declining long-term interest rates is anticipated to support valuation increases in the sector [4] Group 5 - Companies with high electricity generation growth and significant asset injections, such as Guiguan Power and Yangtze Power, are recommended for investment [5] - Other companies to watch include Guodian Power, which has recently seen a rebound, and those with strong dividend commitments [5]

Core Viewpoint - Hydro One Networks Inc. has reached a tentative collective agreement with the Society of United Professionals, covering employees in engineering, supervisory, and other professional roles across Ontario [1][2]. Company Overview - Hydro One Limited is Ontario's largest electricity transmission and distribution provider, serving 1.5 million customers and holding $36.7 billion in assets as of December 31, 2024 [2]. - The company reported annual revenues of $8.5 billion for the year 2024 [2]. Employee and Community Engagement - Hydro One employs 10,100 skilled workers who maintain a reliable electricity system essential for community support [3]. - In 2024, the company invested $3.1 billion in its transmission and distribution networks and contributed $2.9 billion towards local goods and services [3]. - Hydro One is committed to community investment, sustainability, and diversity initiatives [3].