Investors turning to utilities sector for stability, dividends; some companies benefit from serving data

From Nasdaq: 2025-06-05 07:10:00

Investors are turning to the utilities sector for stability and dividend income amidst market volatility. The Utilities Select Sector SPDR Fund (XLU) has returned 8% YTD, outperforming the S&P 500’s 2% increase. Some utilities companies are benefiting from serving data centers crucial to AI and cloud technologies.

Artesian Resources Corp. (ARTNA) in the Mid-Atlantic region saw a 10% YTD share increase with positive earnings surprises. Its water and wastewater revenue growth, customer count increase, and new distribution system charge contributed to a 3.58% dividend yield. With rate increases expected, further growth is anticipated.

Clearway Energy Inc. (CWEN), known for its renewable energy utilities, is focusing on battery storage operations for dispatchable power. It reported an EPS beat in Q1 with a 30% YOY increase in adjusted EBITDA. Despite a high 5.67% dividend yield, its 218.75% payout ratio raises concerns about future dividend sustainability.

NiSource Inc. (NI) is up 8% YTD after beating earnings estimates by 8 cents per share. The company’s $19 billion investment in renewables and analysts’ unanimous Buy rating indicate growth potential. With a 2.84% dividend yield and 60.54% payout ratio, NiSource shows promise for investors seeking stability and growth in utilities.



Read more at Nasdaq:: 3 Utilities Stocks With Big Earnings, Balanced Risk