Blackout-Proof Your Portfolio: 3 Utility Stocks to Own Now

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There’s no denying that the concept of utility stocks to buy is incredibly boring. However, with the market incurring some choppy price action, going for aggressive gambits isn’t always prudent. If you’re playing the black pieces, it might just be best to counter your opponent’s (Mister Market) moves.

Utility stocks to buy will do that for you. Fundamentally, this arena benefits from a natural monopoly. Essentially, would-be rivals don’t even bother competing against entrenched enterprises. Not only is the competition itself stiff, multiple barriers to entry (such as regulations) stand in the way.

Plus, these companies – thanks to their entrenched profile – often provide robust passive income. With that, below are utility stocks to buy.

Duke Energy (DUK)

The logo for Duke Energy (DUK) is seen on a sign at one of the company's offices.

Source: Jonathan Weiss / Shutterstock.com

Based in Charlotte, North Carolina, Duke Energy (NYSE:DUK) specializes in the regulated electric market. Primarily, the company generates, transmits, distributes and sells electricity in the Carolinas, Florida and the Midwest. Analysts rate shares a consensus moderate buy though the average price target of $99.80 requires a rethink since it implies a downside risk of roughly 3%.

Fundamentally, though, Duke definitely warrants consideration among utility stocks to buy. The reason centers on millennial migration trends. With costs of living rising stoutly, young people are having trouble making ends meet. By moving away from overpriced metropolitan areas to places like the Midwest which Duke serves, they’re able to live a more sustainable lifestyle. Of course, that should benefit Duke in the long run.

For fiscal 2024, analysts are looking for earnings per share of $5.97 on revenue of $30.06 billion. Last year, the company posted earnings of $5.56 on sales of $29.06 billion. Further, the blue-sky target calls for $6 EPS on revenue of $31.16 billion. Thanks to the fundamentals of migration, DUK ranks among the top utility stocks to buy.

Portland General Electric (POR)

A concept image of electricity flowing between two disconnected electric cables.

Source: ESB Professional / Shutterstock.com

Based in its namesake city, Portland General Electric (NYSE:POR) is an integrated electric utility company. It engages in the generation, wholesale purchase, transmission, distribution and retail sale of electricity in the state of Oregon. In addition to six thermal plants, it operates three wind farms and seven hydroelectric facilities.

Fundamentally, Portland General should benefit from a similar migration trend that may boost Duke Energy. Due to rising costs, young people may be attracted to moving to less-crowded states like Oregon. Certainly, Portland offers a nice balance of economic resilience, growth and overall livability. Not surprisingly, the company carries a moderate buy assessment with an average price target of $45.43.

For fiscal 2024, covering experts believe EPS will land at $5.97 on revenue of $30.06 billion. Moreover, the blue-sky targets call for EPS of $6 on sales of $31.16 billion. Last year, Portland General posted earnings of $5.56 and a top-line print of $29.06 billion.

Lastly, the utility firm provides a forward annual dividend yield of 4.08%. It’s an underappreciated idea for utility stocks to buy.

Exelon (EXC)

The logo for Exelon (EXC) is visible at the top of an office building.

Source: photosounds / Shutterstock.com

Headquartered in Chicago, Illinois, Exelon (NASDAQ:EXC) is a utility service holding firm. Per its corporate profile, Exelon engages in the energy distribution and transmission businesses in the U.S. and Canada. Primarily, it purchases and regulates the retail sale of electricity and natural gas. It’s also involved in their transmission and distribution.

Analysts are generally optimistic about EXC stock, rating it a consensus moderate buy. The average price target lands at $39.90, which implies roughly 6% upside. However, the high-side target calls for $45, driving the projection up to a 19% return.

Financially, Exelon is a consistent performer. Over the past four quarters ending in the first quarter of this year, the company’s average positive earnings surprise came out to 1.13%. That’s inclusive of a Q1 miss to the tune of 2.9% negative surprise.

For fiscal 2024, analysts see a ho-hum print. However, in 2025, they project EPS to rise to $2.61 on revenue of $22.19 billion. In 2023, the company posted earnings of $2.38 on sales of $21.73 billion. Finally, with a forward yield of 4.02%, Exelon makes a no-nonsense idea for utility stocks to buy.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Tweet him at @EnomotoMedia.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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