The utilities sector rallied in the past month after being in the doldrums since March. Double-digit gains by Vistra Corp. (ticker: VST) and Dominion Energy Inc. (D) helped set the stage for the rally.
For income-focused investors, the sector’s resurgence is a reminder of why dividend-paying utilities can play a role in a well-balanced portfolio. Steady payouts can cushion volatility and provide reliable cash flow during market downturns.
But not all utilities deliver equally on that promise.
[Sign up for stock news with our Invested newsletter.]
Not All Utilities Have a History of Dividend Hikes
“Many investors assume all utilities are equally safe dividend stocks, but only a handful have the multi-decade track record of uninterrupted increases that defines a true Dividend Aristocrat™,” says Richard Siminou, founder of Siminou Wealth Management in New York, referring to companies with a 25-year history of boosting their shareholder payouts.
“When I build income portfolios, that distinction matters,” Siminou adds. He notes that surging electricity demand from data centers and artificial intelligence infrastructure is reshaping the utilities sector.
“The utilities positioned to invest in that growth while maintaining dividend discipline are the ones I pay closest attention to,” Siminou says.
Below are seven utility stocks that income investors may want to consider. These span electric, renewable energy and water utilities:
| Utility Stocks | Forward Dividend Yield | Beta (5-Year Monthly) |
| NextEra Energy Inc. (NEE) | 2.9% | 0.67 |
| Southern Co. (SO) | 3.2% | 0.34 |
| Duke Energy Corp. (DUK) | 3.4% | 0.38 |
| Consolidated Edison Inc. (ED) | 3.2% | 0.27 |
| American States Water Co. (AWR) | 2.6% | 0.59 |
| Eversource Energy (ES) | 4.4% | 0.73 |
| Xcel Energy Inc. (XEL) | 3.0% | 0.41 |
NextEra Energy Inc. (NEE)
Florida-based NextEra Energy is a compelling utility story because it combines the stability of a regulated utility with above-average growth opportunities, says Brady Lochte, founder of Axon Capital Management in Georgetown, Texas.
“Through Florida Power & Light and its renewable energy platform, the company is positioned to benefit from rising electricity demand driven by data centers, AI infrastructure and broader electrification trends,” he says.
The company has a 31-year history of increasing its dividend. The current yield is 2.9%. It boasts a three-year earnings-per-share growth rate of 8%.
“For investors, the appeal is not just the dividend, but the combination of income and long-term earnings growth,” Lochte says.
Southern Co. (SO)
This electric utility, headquartered in Atlanta, is on track for its 25th consecutive annual dividend increase this year. That would land it among the ranks of Dividend Aristocrats™, Siminou points out.
“It is a large regulated utility with exposure to growing electricity demand in the Southeast, a region benefiting from population growth and increasing power needs from data centers,” he says. In its most recent quarter, the company beat earnings views by 11 cents a share. Wall Street expects earnings to grow 6% this year.
“For income clients, it represents a reliable payer that is approaching (Dividend) Aristocrat™ status, which is worth watching,” Siminou notes. Southern pays a forward dividend yield of 3.2%.
Duke Energy Corp. (DUK)
After NextEra and Southern, Duke is the third-largest company, by market cap, within the S&P utilities sector. This is a very stable stock with low volatility, relative to the broader market.
Duke Energy generates and distributes electricity to residential, commercial and industrial customers across North Carolina, South Carolina, Florida, Indiana, Ohio and Kentucky. Its electric utilities segment serves approximately 8.6 million customers.
The company also delivers retail natural gas service to more than 1.7 million customers throughout the Carolinas, Ohio, Kentucky and Tennessee.
Its current dividend yield is 3.4%. Both earnings and revenue grew at a rate of 4% in the past three years; analysts are eyeing an earnings increase of 6% this year and 7% in 2027.
Consolidated Edison Inc. (ED)
Residents of New York’s five boroughs know their power company simply as “Con Ed.” It pays a dividend yield of 3.2%, with the latest quarterly payout being about 89 cents per share.
“Con Edison is one of my favorites for income-focused clients, and it has a special relevance here since it powers the New York City area, where most of my clients live and work,” Siminou says.
The company has a record of increasing its dividend for 52 consecutive years.
“What I like for clients is the predictability,” Siminou says. “Con Edison operates in a constructive, transparent New York regulatory environment … and recently secured a three-year rate plan that gives real visibility into earnings.”
Management is guiding toward earnings growth between 6% and 7% through 2030.
“It will never be a high-growth name, but for a client who needs dependable, rising income, that consistency is exactly the point,” Siminou says.
American States Water Co. (AWR)
A stock that’s paid a dividend for 72 years certainly signals that it can weather all manner of economic storms and market cycles. Full-year 2025 earnings came in at $3.37 per share, up 33 cents on an adjusted basis versus 2024, driven by new customer rates at the regulated utilities.
The San Dimas, California, company has diverse lines of business. It provides water to 265,000 California customers, supplies electricity to Big Bear Lake and manages water systems on 12 military bases nationwide.
Its dividend yield is 2.6%.
“American States Water is a strong example of why dividend quality matters as much as dividend yield. The company operates in the highly predictable water utility business and has built an exceptional record of dividend growth over time,” Lochte says.
“For long-term investors seeking stability, essential-service demand and a management team with a history of returning capital to shareholders, AWR remains one of the more attractive names in the utility sector,” he adds.
Eversource Energy (ES)
Headquartered in Connecticut, Eversource delivers electricity, natural gas and water service across Massachusetts, Connecticut and New Hampshire to more than 4 million customers. Core subsidiaries include Connecticut Light & Power, Yankee Gas Services, Public Service Co. of New Hampshire and NSTAR Electric.
Eversource has boosted its dividend for 26 years in a row. Its forward yield is 4.4%. The company also beat Wall Street earnings estimates in each of the past four quarters.
However, Eversource’s 2026 earnings are expected to dip by about 2% for two reasons. First, a federal regulator trimmed the profit margin the company is allowed to earn on its transmission lines. Second, the recent sale of its water utility subsidiary removed a revenue source that had been padding results.
Neither development signals trouble; management still targets 5% to 7% annual earnings growth over the long term.
Xcel Energy Inc. (XEL)
This Minneapolis-based utility holding company serves around 3.7 million electricity and 2.1 million natural gas customers across eight Midwestern and Western states through four subsidiaries.
The company’s generating facilities are powered by coal, natural gas, nuclear, wind and solar. The company has increased its dividend for 22 consecutive years; it yields 3% and its quarterly dividend is about 59 cents a share.
As with many other utilities and stable dividend payers generally, this stock has a low beta, a sign that its price moves are relatively independent of broader market gyrations.
Earnings grew 8% in the most recent quarter; analysts expect a gain of 5% in the current quarter and 8% for the full year.
More from U.S. News
8 Best Green Stocks and ETFs to Buy in 2025
7 Best Biotech Stocks to Buy for 2026
7 Best Semiconductor Stocks for 2026
7 Best Utility Stocks to Buy for Dividends originally appeared on usnews.com
Update 06/24/26: This story was published at an earlier date and has been updated with new information.
