This top utility stock also makes good sense now for conservative accounts. Exelon Corp. (NYSE: EXC) is the nation’s leading competitive energy provider, with 2014 revenues of approximately $27.4 billion. Headquartered in Chicago, Exelon does business in 48 states, the District of Columbia and Canada. Exelon is one of the largest competitive U.S. power generators, with approximately 32,500 megawatts of owned capacity comprising one of the nation’s cleanest and lowest-cost power generation fleets.
The company’s Constellation business unit provides energy products and services to more than 2.5 million residential, public sector and business customers, including more than two-thirds of the Fortune 100. Exelon’s utilities deliver electricity and natural gas to more than 7.8 million customers in central Maryland, northern Illinois and southeastern Pennsylvania.
Exelon investors receive a 3.65% dividend. Deutsche Bank raised its price target to $40. The consensus target is $38.47 and the stock closed Wednesday at $34.85.
With a very strong balance sheet, and this company looks poised for a solid second half of 2016. NextEra Energy Inc. (NYSE: NEE) is a leading clean energy company with consolidated revenues of over $17.0 billion and approximately 44,900 megawatts of generating capacity, which includes megawatts associated with noncontrolling interests related to NextEra Energy Partners.
Headquartered in Juno Beach, Florida, NextEra Energy’s principal subsidiaries are Florida Power & Light Company, which serves approximately 4.8 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources, which, together with its affiliated entities, is the world’s largest generator of renewable energy from the wind and sun.
Top analysts feel the company may very well be one of the top total return plays out of the large cap regulated space in the sector. One of the key drivers of NextEra’s growth has been the renewable energy development program, which continues to expand as the company adds new projects to its backlog. Those projects are expected to help grow 6% to 8% compound annual growth in adjusted earnings per share through 2018. Most on Wall Street feel that the steady earnings growth should also provide consistent dividend growth over that same time frame.
Shareholders receive a 2.72% dividend. The $133 Deutsche Bank price target is near the consensus target of $133.94. The stock closed Wednesday at $127.84.
This is another utility rated Buy at Deutsche Bank that investors can feel super comfortable owning now. PG&E Corp. (NYSE: PCG) is one of the largest combined natural gas and electric utilities in the United States. Based in San Francisco, with more than 20,000 employees, the company delivers energy to nearly 16 million people in Northern and Central California.
The company operates 141,215 circuit miles of electric distribution lines, 18,616 circuit miles of interconnected transmission lines, 42,141 miles of natural gas distribution pipelines and 6,438 miles of gas transportation pipelines. It operates generation facilities with energy sources such as nuclear, hydroelectric, fossil fuel-fired and photovoltaic.
PG&E shareholders receive a 3.08% dividend. Deutsche Bank has a $67 price target, largely in line with the consensus number of $67.33. Shares closed on Wednesday at $63.71.
The huge capital gains for the sector from the quantitative easing days may be way in the rear-view mirror, but that doesn’t change the upside potential, albeit small, for these top companies. Even with potential rate increases starting to hit the tape again in December, they will remain small and very slow and should have a negligible effect. These top stocks make excellent additions to growth and income total return portfolios looking for safety now.