Global electricity demand is soaring, driven by urbanization, population growth, and the adoption of technologies like EVs and data centers. As decarbonization efforts accelerate electrification across industries, the utility sector is experiencing robust growth, solidifying its role in shaping a sustainable future.

For investors seeking opportunities in this evolving market, top utility stocks Edison International (EIX - Get Rating), FirstEnergy Corp. (FE - Get Rating), and Genie Energy Ltd. (GNE - Get Rating) are leading the charge and could be solid buys, offering reliable investment opportunities. As the energy sector evolves, these stocks represent compelling opportunities for 2025 and beyond. In addition, these stocks have a history of paying consistent dividends.

The global electricity demand is surging, driven by transformative trends reshaping the energy landscape. Rapid urbanization, population growth, and the widespread adoption of technologies such as electric vehicles (EVs) and data centers fuel a steady rise in energy consumption. At the same time, the global push toward decarbonization has accelerated electrification across sectors like transportation, heating, and industrial processes, solidifying electricity’s role as the cornerstone of a sustainable future.

Driven by global economic acceleration, increased renewable energy investments, and rising utility mergers and acquisitions, the utility sector is booming. The global utilities market is projected to grow significantly, reaching $8.83 trillion by 2028 at a CAGR of 6.4%.

Considering these positive trends, let’s delve deeper into Utilities – Domestic stocks:

Stock #3: Edison International (EIX - Get Rating)

EIX generates and distributes electricity across a 50,000-square-mile area in Southern California, serving residential, commercial, and industrial sectors. Its infrastructure includes extensive transmission and distribution lines, substations, and facilities to ensure reliable power delivery.

On December 12, EIX announced a quarterly dividend increase to $0.8275 per share, payable on January 31, 2025, raising the annual dividend rate to $3.31 per share, a 6.1% increase from the previous $3.12 rate. It pays an annual dividend of $ 3.31, which translates to a dividend yield of 4.15% at the prevailing price levels. Its four-year average dividend yield is 4.24%. The company has grown its dividend payment at a CAGR of 5.6% over the past three years.

In the fiscal third quarter ended September 30, 2024, EIX’s operating revenue increased 10.6% year-over-year to $5.20 billion. Its operating income grew 102.2% from the year-ago value to $995 million. In addition, the net income available to Edison International common shareholders came in at $516 million and $1.51 per share, up 232.9% and 9.4% over the prior-year quarter, respectively.

Street expects EIX’s revenue and EPS for the year ending December 30, 2024, to increase 5.6% and 3.9% year-over-year to $17.25 billion and $4.95, respectively. In addition, it surpassed the consensus EPS estimates in all of the trailing four quarters, which is promising.

Over the past year, the stock has gained 11.5% and 11.1% over the past six months to close the last trading session at $79.80.

EIX’s POWR Ratings reflect its robust outlook. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.

EIX has a B grade in Growth. It is ranked #12 out of 59 stocks in the Utilities – Domestic industry.

Beyond what we have stated above, we also have given EIX grades for Value, Momentum, Stability, Sentiment, and Quality. Get all the EIX’s ratings here.

Stock #2: FirstEnergy Corp. (FE - Get Rating)

FE generates, transmits, and distributes electricity through coal, nuclear, hydroelectric, wind, and solar facilities. Serving around 6 million customers across six U.S. states, it operates extensive transmission and distribution networks.

It pays an annual dividend of $1.70, which translates to a dividend yield of 4.26% at the prevailing price levels. Its four-year average dividend yield is 4.09%. The company has grown its dividend payment at a CAGR of 2.6% over the past three years.

On December 23, FET, a subsidiary of FE, announced an exchange offer for up to $400 million of its outstanding 4.6% Senior Notes due 2030 and $400 million of its outstanding 5% Senior Notes due 2035. The offer allows noteholders to exchange their outstanding notes for an equal amount of new notes registered under the Securities Act of 1933.

On December 19, FE, operating as Met-Ed, Penn Power, Penelec, and West Penn Power, secured approval from the Pennsylvania Public Utility Commission for phase three of its Long-Term Infrastructure Improvement Plans (LTIIP III). This initiative aims to enhance electric service reliability for over two million customers across Pennsylvania.

FE’s total revenues increased 5.7% year-over-year to $ 3.70 billion in the fiscal third quarter that ended on September 30, 2024. In addition, the company’s earnings from continuing operations stood at $419 million, and non-GAAP operating EPS reached $0.85.

The market expects FE’s revenue for the fiscal fourth quarter (ending December 31, 2024) to increase 17.2% year-over-year to $3.69 billion. Its EPS for the same quarter is expected to grow 11.6% from the prior year to $0.69. In addition, it surpassed the consensus EPS estimates in three of the trailing four quarters.

Shares of FE have gained 5.7% over the past year and are up 3.9% over the past six months to close the last trading session at $39.92.

FE’s POWR Ratings reflect its robust outlook. It has a B grade in Growth and Stability. It is ranked #3 in the same industry.

Click here to see FE’s ratings for Value, Momentum, Sentiment, and Quality.

Stock #1: Genie Energy Ltd. (GNE - Get Rating)

GNE supplies electricity and natural gas to residential and small business customers in the U.S. and internationally. It operates through GRE and Genie Renewables segments, focusing on solar energy projects, community solar solutions, energy brokerage, and solar panel manufacturing and installation services.

It pays an annual dividend of $0.30, which translates to a dividend yield of 1.92% at the prevailing price levels. Its four-year average dividend yield is 2.06%. The company has grown its dividend payment at a CAGR of 52.3% over the past three years.

On November 19, GNE secured a $7.4 million fixed-rate term loan from the National Cooperative Bank (NCB) to finance a 10MW solar array portfolio. GNE acquired through its Sunlight Energy subsidiary, the arrays supply power to educational facilities in three Midwestern states via fixed-price solar PPAs.

In the fiscal third quarter ended September 30, 2024, GNE’s total revenues were $111.92 million. Its income from operations was $11.68 million. In addition, the company’s non-GAAP net income attributable to Genie common stockholders and non-GAAP EPS stood at $10.90 million and $0.41, respectively.

Shares of GNE have gained 2.7% over the past six months and gained 4.4% over the past month to close the last trading session at $15.59.

GNE’s POWR Ratings reflect its robust outlook. The stock has an overall rating of B, equating to a Buy in our proprietary rating system.

It has a B grade in Value and Quality. It tops the same industry.

Click here to see GNE’s ratings for Growth, Momentum, Stability, and Sentiment.

What To Do Next?

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EIX shares were unchanged in premarket trading Monday. Year-to-date, EIX has declined -0.05%, versus a 1.00% rise in the benchmark S&P 500 index during the same period.

About the Author: Kritika Sarmah

Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She earned her bachelor's degree in commerce and is currently pursuing the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities. More...

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