2022 Utilities Sector Stocks List | Updated Daily

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2022 Utilities Sector Stocks List | Updated Daily


Updated on November 15th, 2021 by Bob Ciura

Spreadsheet data updated daily

Utility stocks can make excellent investments for long-term dividend growth investors.

Durable, regulatory-based competitive advantages allow these companies to consistently raise their rates over time. In turn, this allows them to raise their dividend payments year in and year out.

Even better, many utility stocks have above-average dividend yields, providing a compelling combination of income now and growth later for long-term investors.

Because of these favorable industry characteristics, we’ve compiled a list of utility stocks. The list is derived from the major utility sector exchange-traded funds JXI, VPU and XLU.

You can download the list of all utility stocks (along with important financial ratios such as dividend yields and payout ratios) by clicking on the link below:

 

Keep reading this article to learn more about the benefits of investing in utility stocks.

Table Of Contents

The following table of contents provides for easy navigation:

How To Use The Utility Dividend Stocks List To Find Investment Ideas

Having an Excel database of all the dividend-paying utility stocks combined with important investing metrics and ratios is very useful.

This tool becomes even more powerful when combined with knowledge of how to use Microsoft Excel to find the best investment opportunities.

With that in mind, this section will provide a quick explanation of how you can instantly search for utility stocks with particular characteristics, using two screens as an example.

The first screen that we will implement is for utility stocks with price-to-earnings ratios below 15.

Screen 1: Low P/E Ratios

Step 1: Download the Utility Dividend Stocks Excel Spreadsheet List at the link above.

Step 2: Click the filter icon at the top of the price-to-earnings ratio column, as shown below.

Utility Dividend Stocks Landing Page Excel 1

Step 3: Change the filter field to ‘Less Than’, and input ’15’ into the field beside it.

Utility Dividend Stocks Landing Page Excel 2

The remaining list of stocks contains dividend-paying utility stocks with price-to-earnings ratios less than 15. As you can see, there are relatively few securities (at the time of this writing) that meet this strict valuation cutoff.

The next section demonstrates how to screen for large-cap stocks with high dividend yields.

Screen 2: Large Cap Stocks With High Dividend Yields

Businesses are often categorized based on their market capitalization. Market capitalization is calculated as stock price multiplied by the number of shares outstanding and gives a marked-to-market perception of what people think a business is worth on average.

Large-cap stocks are loosely defined as businesses with a market capitalization above $10 billion and are perceived as lower risk than their smaller counterparts. Accordingly, screening for large-cap stocks with high dividend yields could provide interesting investment opportunities for conservative, income-oriented investors.

Here’s how to use the Utility Dividend Stocks Excel Spreadsheet List to find such investment opportunities.

Step 1: Download the Utility Dividend Stocks Excel Spreadsheet List at the link above.

Step 2: Click the filter icon at the top of the Market Cap column, as shown below.

Utility Dividend Stocks Landing Page Excel 3

Step 3: Change the filter setting to ‘Greater Than’, and input 10000 into the field beside it. Note that since market capitalization is measured in millions of dollars in this Excel sheet, filtering for stocks with market capitalizations greater than ‘$10,000 millions’ is equivalent for screening for those with market capitalizations exceeding $10 billion.

Utility Dividend Stocks Landing Page Excel 4

Step 4: Close that filter window (by exiting it, not by clicking ‘clear filter’) and click on the filter icon for the ‘dividend yield’ column, as shown below.

Utility Dividend Stocks Landing Page Excel 5

Step 5: Change the filter setting to ‘Greater Than’ and input 0.03 into the column beside it. Note that 0.03 is equivalent to 3%.

Utility Dividend Stocks Landing Page Excel 6

The remaining stocks in this list are those with market capitalizations above $10 billion and dividend yields above 3%. This narrowed investment universe is suitable for investors looking for low-risk, high-yield securities.

You now have a solid fundamental understanding of how to use the Utility Dividend Stocks Excel Spreadsheet List to its fullest potential. The remainder of this article will discuss the characteristics that make the utility sector attractive for dividend growth investors.

Why Utility Dividend Stocks Make Attractive Investments

The word ‘utility’ describes a wide variety of business models but is usually used as a reference to electric utilities – companies that engage in the generation, transmission, and distribution of electricity.

Other types of utilities include propane utilities and water utilities.

So why do these businesses make for attractive investments?

Utilities usually conduct business in highly regulated markets, complying with rules set by federal, state, and municipal governments.

While this sounds highly unattractive on the surface, what it means in practice is that utilities are basically legal monopolies.

The strict regulatory environment that utility businesses operate in creates a strong and durable competitive advantage for existing industry participants.

For this reason, electric utilities are among the most popular stocks for long-term dividend growth investors – especially because they tend to offer above-average dividend yields.

Indeed, the regulatory-based competitive advantages available to utility stocks give them the consistency to raise their dividends regularly.

Simply put, utility stocks are some of the most dependable dividend stocks around.

To provide a few examples, the following utility stocks have exceptionally long streaks of consecutive dividend increases:

The long streak of consecutive dividend increases is possible only because of their unique industry-specific competitive advantages.

Clearly, the utility sector is very stable. People are going to need electricity and water in ever-increasing amounts for the foreseeable future.

One characteristic that does not describe utility stocks is high growth. One of the regulatory constraints imposed upon utility companies is the pace at which they can increase the fees paid by their customers.

These rate increases are usually in the low-single-digits, which provides a cap on the revenue growth experienced by these companies.

Utility stocks typically don’t offer strong total returns, but there are exceptions.

The Top 10 Utility Stocks Now

Taking all of the above into consideration, the following section discusses our top 10 list of utility stocks today, based on their expected annual returns over the next five years.

The rankings in this article are derived from our expected total return estimates from the Sure Analysis Research Database.

The 10 utility stocks with the highest projected five-year total returns are ranked in this article, from lowest to highest.

Related: Watch the video below to learn how to calculate expected total return for any stock.

 

Rankings are compiled based upon the combination of current dividend yield, expected change in valuation, as well as expected annual earnings-per-share growth.

This determines which utility stocks offer the best total return potential for shareholders.

Top Utility Stock #10: Dominion Energy (D)

Dominion Energy is a large electric and gas utility that serves more than 7 million customers in 16 states.

It has 65,000 miles of electric transmission and distribution lines in West Virginia, Virginia and North Carolina to deliver power to about 2.6 million electric customer accounts.

Its power generation is fueled by nuclear, natural gas, coal, oil, biomass, water, wind and the sun.

The SCANA acquisition that closed in January 2019 consists of a power generation & delivery business in South Carolina, a gas distribution business in North & South Carolina, and a regulated gas supply business that predominately serves Georgia.

We expect annual returns of 10.0% per year, due to 6.5% EPS growth, the 3.4% dividend yield, and a virtually flat P/E multiple.

Click here to download our most recent Sure Analysis report on Dominion (preview of page 1 of 3 shown below):


Top Utility Stock #9: Southwest Gas Holdings (SWX)

Southwest Gas Holdings Inc. is a holding company that operates in two business segments, Natural Gas Operations and Utility Infrastructure Services.

The Natural Gas business, Southwest Gas Corp., purchases, distributes and transports natural gas in Arizona, California and Nevada and serves over 2 million customers.

The corporation also owns and operates an interstate pipeline through their subsidiary Paiute Pipeline Company. Paiute also runs a peak shaving LNG storage facility.

The Utility business, Centuri Group Inc. delivers a multitude of energy solutions to North America’s gas and electric providers. Centuri operates in 40 states and provinces in the U.S. and Canada.

We expect 10.2% annual returns, due to 5.5% annual EPS growth, the 3.4% dividend yield and a moderate boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on Southwest Gas Holdings (preview of page 1 of 3 shown below):


Top 10 Utility Stock #8: Evergy, Inc. (EVRG)

Evergy is an electric utility holding company incorporated in 2017 and headquartered in Kansas City, Missouri.

Through its subsidiaries, the company serves approximately 1.4 million residential customers, nearly 200,000 commercial customers and 6,900 industrial customers and municipalities in Kansas and Missouri.

We expect annual returns just above 10% per year for Evergy stock.

Click here to download our most recent Sure Analysis report on Evergy, Inc. (preview of page 1 of 3 shown below):


Top Utility Stock #7: OGE Energy Corp. (OGE)

OGE Energy (OGE) was founded in 1995, in Oklahoma. It is the parent company of Oklahoma Gas and Electric Company (OG&E), a regulated electric utility that serves more than 860,000 customers in Oklahoma and western Arkansas.

OGE Energy also owns 25.5% of Enable Midstream Partners (ENBL), a Master Limited Partnership (MLP) that owns and operates pipeline networks and storage tanks of natural gas and crude oil.

We expect annual returns of 10%-11% per year, due to 5% annual EPS growth, the 4.8% dividend yield, and a small boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on OGE (preview of page 1 of 3 shown below):


Top Utility Stock #6: Spire Inc. (SR)

Spire provides natural gas service through its regulated core utility operations while engaging in nonregulated activities that provide business opportunities.

The company has five gas utilities, serving 1.7 million homes and businesses across Alabama, Mississippi, and Missouri. This makes Spire the 5th largest publicly traded natural gas company in the country.

Spire generated $1.855 billion in sales in 2020. Spire has been growing its dividends for 19 years.

Click here to download our most recent Sure Analysis report on Spire (preview of page 1 of 3 shown below):


Top Utility Stock #5: Pinnacle West Capital Corporation (PNW)

Pinnacle West Capital is a holding company. Through its principal subsidiary, Arizona Public Service (APS), the company provides electricity service to more than 1.3 million Arizona homes and businesses.

The company has the generating capacity to produce 6,300 megawatts.

PNW has been paying a dividend for 27 years and growing the dividend consecutively for the past 10 years.

We expect annual returns of 11.8% per year, due to 2% expected EPS growth, the 5.1% dividend yield and a ~4.7% boost from an expanding P/E multiple.

Click here to download our most recent Sure Analysis report on Pinnacle West Capital (preview of page 1 of 3 shown below):


Top Utility Stock #4: ONE Gas, Inc. (OGS)

ONE Gas provides natural gas distribution services to approximately 2.2 million customers.

It is the largest natural gas distributor in Oklahoma (88% market share) and Kansas (72% market share), and the thirdlargest in Texas (13% market share).

Source: Investor Presentation

Its customers are residential, commercial, and transportationrelated in all three states. The company generates around $1.6 billion in annual revenues.

Click here to download our most recent Sure Analysis report on OGS (preview of page 1 of 3 shown below):

Top Utility Stock #3: Sempra (SRE)

Sempra Energy serves one of the largest utility customer bases in the U.S., as it distributes natural gas and electricity in Southern California to over 20 million customers.

It also owns a majority stake in Texasbased Oncor, a transmission and distribution business with over 10 million customers.

Source: Investor Presentation

The company also owns and operates other utilities and merchant renewable energy projects, liquefied natural gas facilities, and gas pipes and storage in the U.S. and Latin America.

We expect annual returns above 12% per year for Sempra, due to a combination of EPS growth (5%), the 3.6% dividend yield, and a low single-digit boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on Sempra (preview of page 1 of 3 shown below):

Top Utility Stock #2: South Jersey Industries, Inc. (SJI)

South Jersey Industries buys, transports, stores, and sells natural gas.

The utility operates in three segments: SJI Utilities, SJI Midstream, and South Jersey Energy Solutions. It owns and operates rooftop solar generation at corporate sites, fuel cells, and is investing in renewable natural gas projects.

Additionally, the utility owns oil, gas, and mineral rights in the Marcellus Shale region of Pennsylvania. South Jersey owns roughly 10,000 miles of distribution and transmission pipeline, and serves over 700,000 total customers.

In total, we see ~12% total annual returns for South Jersey Industries, consisting of ~6% earnings growth, a nearly 4% yield, and a modest headwind from the valuation drifting slightly lower over time.

Click here to download our most recent Sure Analysis report on South Jersey Industries (preview of page 1 of 3 shown below):


Top Utility Stock #1: Suburban Propane Partners, L.P. (SPH)

The best utility stock on our list is Suburban Propane Partners, an MLP engaged in propane distribution.

The partnership services most of the U.S. with propane and other energy sources, with propane making up around 90% of total revenue.

Source: Investor Presentation

It should generate about $1.25 billion in revenue this year. The partnership has over 3,200 fulltime employees in 41 states, serving approximately 1 million customers.

We expect total returns of 14.6% per year. Suburban Propane yields 8.4%, making it a high dividend stock.

In addition, we expect 1% annual growth, and a significant P/E expansion of 5.2% per year.

Click here to download our most recent Sure Analysis report on Suburban Propane Partners (preview of page 1 of 3 shown below):

Final Thoughts

The utility sector is a great place to find high-quality dividend stocks suitable for long-term investment.

It is not, however, the only place to find attractive investments.

If you’re willing to venture outside of the utility industry for investment opportunities, the following Sure Dividend databases are very useful:

If you’re looking for other sector-specific dividend stocks, the following Sure Dividend databases will be useful:

Thanks for reading this article. Please send any feedback, corrections, or questions to support@suredividend.com.


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