Key Takeaways PPL and XEL's return on equity are pegged at 9.08% and 10.45%, respectively.PPL and XEL expect to invest $20B and $60B, respectively, to strengthen their infrastructure.XEL is currently trading at a P/EF12M of 17.99X, marginally cheaper than PPL's 18.01X.The U.S. utility sector is going through a phase of rapid transformation as electricity demand rebounds after a prolonged period of stability. Rising power needs from data centers, AI-driven computing, electrified transport and heating, and re ...

Core Viewpoint - The energy sector has underperformed compared to the broader market, with average energy stocks in the S&P 500 up about 4% year-to-date, while the broader market index rose nearly 18% due to lower oil prices [1][2] Group 1: ConocoPhillips - ConocoPhillips is a leading oil and gas producer with a diversified portfolio and low operating costs [4] - The company requires an average oil price in the mid-$40s to sustain capital spending and about $10 more per barrel to fund its dividend, currently generating substantial surplus free cash flow with crude oil priced in the low $60s [4][5] - Expected completion of large-scale liquefied natural gas projects and the Willow oil project in Alaska could add an incremental $6 billion in annual free cash flow by 2029, assuming a $60 oil price [5] - ConocoPhillips produced $6.1 billion in free cash flow through the first nine months of the year and recently increased its dividend by 8%, aiming for dividend growth within the top 10% of S&P 500 companies [7] Group 2: Oneok - Oneok is one of the largest energy midstream companies in the U.S., generating stable cash flow supported by long-term contracts and government-regulated rate structures [8] - The company has expanded its midstream platform through acquisitions, including Magellan Midstream Partners and Medallion Midstream, totaling $10.2 billion [10] - Oneok expects to capture hundreds of millions in cost savings and synergies from these acquisitions and has approved several organic expansion projects, which should enhance its dividend growth by 3% to 4% annually [11] Group 3: NextEra Energy - NextEra Energy is a leading electric utility and energy infrastructure development company, with a Florida-based utility generating steadily rising rate-regulated earnings [12] - The company plans to invest upwards of $100 billion by 2032 to support growing energy demand in Florida, alongside investments in electricity transmission lines and clean power projects [14] - Expected compound annual earnings-per-share growth of over 8% over the next decade positions NextEra Energy to increase its dividend by 10% next year and at a 6% compound annual growth rate through at least 2028 [15] Group 4: Overall Investment Potential - ConocoPhillips, Oneok, and NextEra Energy are identified as top energy stocks with visible growth ahead, expected to continue increasing their high-yielding dividends [16]

Edison International (NYSE:EIX) is included among the 11 Best Utility Stocks to Invest in According to Hedge Funds. Edison International (EIX) Price Targets Reduced Amid Cautious Outlook for the Utility Sector Edison International (NYSE:EIX) is one of the largest electric utility holding companies in America, focused on providing clean and reliable energy and energy services through its independent companies. Morgan Stanley analyst David Arcaro reduced the firm’s price target on Edison International (NY ...

This story was originally published on Utility Dive. To receive daily news and insights, subscribe to our free daily Utility Dive newsletter. Dive Brief: The Federal Energy Regulatory Commission should tell the PJM Interconnection that it can only add large data centers to its system when they can be reliably served, according to a complaint filed Tuesday at the agency by the grid operator’s market monitor. PJM is considering proposing to allow data center loads that it cannot serve reliably and that wi ...

Core Viewpoint - Otter Tail Corporation will announce its third quarter 2025 financial results on November 3, 2025, and will host a conference call on November 4, 2025, to discuss its financial and operational performance [1]. Group 1: Financial Results Announcement - The financial results will be released after the stock market closes on November 3, 2025 [1]. - A live conference call and webcast will take place on November 4, 2025, at 10:00 a.m. CT [1]. Group 2: Accessing the Webcast - Accompanying slides will be available on the corporation's website prior to the webcast [2]. - Participants are encouraged to visit the website in advance to download any necessary software [2]. - A recording of the webcast will be accessible on the corporation's website shortly after the call [2]. Group 3: Participation Information - Pre-registration for the conference call is required to obtain the dial-in number and passcode [3]. - Contact information for inquiries regarding participation is provided [3]. Group 4: Company Overview - Otter Tail Corporation operates in diversified sectors, including an electric utility and manufacturing businesses [4]. - The company's stock is traded on the NASDAQ Global Select Market under the symbol OTTR [4]. - Corporate offices are located in Fergus Falls, Minnesota, and Fargo, North Dakota [4].

Core Insights - The energy sector, while accounting for only 7% of America's GDP, is fundamental to the entire economy and lifestyle, as it supports all other sectors [1][3] - Future growth in various industries, including manufacturing, AI, and vehicle electrification, is contingent upon increased energy supply [1] Energy's Economic Role - Energy is essential for the functioning of finance, commerce, communications, healthcare, and transportation, indicating that the remaining 93% of GDP relies on energy [3] - The uninterrupted flow of affordable and reliable power is critical for modern society [3] Infrastructure Challenges - Mark Christie will address the $2 trillion infrastructure challenges at the intersection of power and digital growth during the upcoming Data Center POWER eXchange event [2] - AI-driven power demand is straining existing infrastructure, highlighting the need for improved reliability and market design for utilities and regulators [2] Supply Chain Vulnerabilities - The U.S. electric grid's reliance on overseas manufacturing for critical components poses significant risks, particularly with China being the primary supplier of essential transformers [4] - The American Society of Civil Engineers has rated U.S. energy infrastructure as a D+, emphasizing the urgency of reshoring grid components to enhance resilience [4]

Core Insights - Otter Tail Corporation (NASDAQ:OTTR) is recognized as one of the best diversified stocks to buy according to hedge funds [1][4] - Moody's has lowered the credit rating of Otter Tail Power Company, a subsidiary of Otter Tail Corporation, due to increased spending and borrowing, although the outlook remains stable [2] - The company reported strong second-quarter results with diluted EPS of $1.85, exceeding the forecast of $1.72, and revenue of $333.04 million, surpassing the expected $325.8 million, leading to a 6.14% increase in share price [3] Financial Performance - Otter Tail Corporation's diluted EPS was reported at $1.85, above the forecast of $1.72 [3] - Revenue for the quarter was $333.04 million, exceeding the forecast of $325.8 million [3] - Following the earnings release, the share price rose to $76.22, reflecting a solid cash position and an increase in 2025 earnings guidance [3] Business Segments - The company operates in electric utility, manufacturing, and plastic pipe businesses, indicating a diversified operational structure [4] - Otter Tail Corporation is focusing on renewable energy projects and strategic investments in manufacturing, positioning itself for future growth [3]

Group 1 - Brookfield Infrastructure Partners L.P. (NYSE:BIP) is recognized as one of the best electric utility stocks to buy, with Jefferies resuming coverage and issuing a "Buy" rating with a price target of $35 [1][2] - The company has a diverse global presence across Transport, Utilities, Midstream, and Data sectors, which enhances its investment appeal [1][3] - In Q2 2025, Brookfield Infrastructure reported a net income of $69 million, a significant increase from $8 million in the previous year, driven by strong operational performance and capital recycling activities [2] Group 2 - The company executed three major acquisitions in Q2 2025 and achieved substantial proceeds from asset sales, showcasing its effective capital recycling strategy [2] - Brookfield Infrastructure's ability to acquire high-quality assets and monetize mature investments at attractive returns distinguishes its platform and supports a growing pipeline of opportunities [2]

Core Insights - The second-quarter 2025 earnings season is expected to show resilience and an improving outlook for the banking sector and overall market [1] - Total S&P 500 earnings are projected to increase by 4.9% year-over-year, driven by a 3.9% rise in revenues [2] - Nine out of sixteen Zacks sectors are anticipated to report earnings growth, with Consumer Discretionary leading at 105.6% [3] Sector Performance - Consumer Discretionary sector is expected to see the highest earnings growth at 105.6%, followed by Aerospace at 15.1%, Technology at 11.8%, Finance at 7.8%, and Utilities at 7.7% [3] - The "Magnificent 7" companies are projected to have an 11.3% increase in earnings with an 11.2% rise in revenues compared to the same period last year [3] ETF Highlights - Consumer Discretionary Select Sector SPDR Fund (XLY) has an AUM of $22.5 billion and an expense ratio of 0.08% [5] - iShares U.S. Aerospace & Defense ETF (ITA) holds $8.4 billion in AUM with an expense ratio of 0.40% [6] - Vanguard Information Technology ETF (VGT) manages $95 billion in assets and has an expense ratio of 0.09% [7] - Financial Select Sector SPDR Fund (XLF) has an AUM of $51.3 billion and charges 0.08% in annual fees [8] - Utilities Select Sector SPDR (XLU) has an AUM of $19.1 billion and an expense ratio of 0.08% [9]