The Zacks Utilities sector’s first-quarter 2026 earnings are likely to have benefited from recently implemented electric, natural gas and water rate hikes, along with ongoing cost-efficiency measures and a growing customer base. Rising demand from data centers is also expected to have supported bottom-line growth. According to the latest Earnings Preview, the sector’s earnings are projected to increase 7.9% on revenue growth of 8%.
With the assistance of the Zacks Stock Screener, we have identified three utilities, namely Vistra Corp. VST, Ameren Corporation AEE and PPL Corporation PPL, which are poised to beat on earnings this reporting cycle.
These stocks have the ideal combination of two ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) — to surpass expectations. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Major Drivers of Utility Stocks’ Q1 Performance
Utilities are set to benefit from rising electricity demand, primarily fueled by the rapid expansion of data centers, particularly those supporting AI, along with increased consumption from commercial and industrial customers. In addition, the reshoring of industries amid geopolitical uncertainty has been creating fresh demand for utility services. Collectively, these factors are likely to have supported higher revenues in the upcoming quarter.
Utility service providers continue to benefit from several supportive factors, including higher electricity rates, value-accretive acquisitions, cost-cutting measures and the rollout of energy-efficiency programs. These companies have also been gaining from ongoing investments to strengthen infrastructure against extreme weather, along with a steady transition toward cost-effective renewable energy sources for power generation.
Utilities have been investing in smart meter deployments, expanding transmission and distribution networks and strengthening infrastructure maintenance, all of which enhance operational efficiency and support better customer engagement. These efforts help lower costs, drive revenue growth and improve overall grid management.
At the same time, improving economic conditions across service territories are generating new demand for utility services, supporting stronger revenues and overall performance.
Potential Utility Outperformers for This Earnings Season
Ameren generates and distributes electricity and natural gas to residential, commercial, industrial and wholesale end markets in Missouri and Illinois. The company's systematic investments in growth projects, infrastructure upgrades and renewable portfolio will help improve service reliability and generate higher profits. Ameren plans a major expansion of its clean energy portfolio, targeting the addition of 2,700 MW of renewable generation capacity by 2030 and reaching a total of 4,200 MW by 2035.
The Zacks Consensus Estimate for its first-quarter earnings is pegged at $1.17 per share, indicating an increase of 9.35% from the year-ago reported figure. AEE currently has an Earnings ESP of +1.29% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Ameren Corporation Price and EPS Surprise
Ameren Corporation price-eps-surprise | Ameren Corporation Quote
Vistra is an integrated power company operating in competitive U.S. markets, supplying electricity and natural gas to residential, commercial and industrial customers, while managing a diversified generation fleet that supports and hedges its retail operations. Long-term contracts with high-quality partners strengthen stability.
The Zacks Consensus Estimate for its first-quarter earnings is pegged at $2.21 per share, indicating an increase of 380.43% from the year-ago reported figure. VST currently has an Earnings ESP of +4.79% and a Zacks Rank #3.
Vistra Corp. Price and EPS Surprise
Vistra Corp. price-eps-surprise | Vistra Corp. Quote
PPL Corporation primarily generates electricity from power plants in the northeastern, northwestern and southeastern United States. The company markets wholesale or retail energy chiefly in northeastern and northwestern portions of the United States. PPL is experiencing load growth, driven by data center demand. In Pennsylvania, nearly 25.2 GW (up from 20.5 GW) of potential data-center demand is in the advanced stages. In the Kentucky segment, the Economic development queue holds total potential load growth of 9.3 GW through 2032 (up from 8.5 GW).
The Zacks Consensus Estimate for its first-quarter earnings is pegged at 0.61 cents per share, indicating an increase of 1.67% from the year-ago reported figure. PPL currently has an Earnings ESP of +0.41% and a Zacks Rank #3.
PPL Corporation Price and EPS Surprise
PPL Corporation price-eps-surprise | PPL Corporation Quote
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
Free: See Our Top Stock And 4 Runners UpPPL Corporation (PPL) : Free Stock Analysis Report
Ameren Corporation (AEE) : Free Stock Analysis Report
Vistra Corp. (VST) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
