The S&P 500 utilities sector has seen a 15% gain in 2025, signaling a new opportunity for investors. Utility stocks offer stability in uncertain times, especially with growing AI and data center demands. As interest rate cuts loom in 2026, dividend stocks, particularly utilities, are poised to benefit.

Large hyperscale data centers are driving demand for utilities, with AI adoption on the rise. Despite recent turbulence, top companies in the AI/data-center trade are expected to thrive. Utility stocks, being recession-resistant, are a safe bet due to constant electricity demand.

Dividends have historically accounted for 32% of the S&P 500’s total return, making them crucial for investors. Companies like Dominion Energy Inc. (NYSE: D) and Duke Energy Corp. (NYSE: DUK) are top picks offering strong dividends and stability.

Exelon Corp. (NYSE: EXC) and Southern Co. (NYSE: SO) are solid utility stocks for conservative investors seeking steady returns. With substantial customer bases and diverse energy portfolios, these companies offer reliable dividends and growth potential.

Retirement savings can double by adopting a simple habit, according to a recent study. Understanding the importance of dividends and capital appreciation is crucial for long-term financial success. Consider utility stocks for stability and passive income, especially in uncertain market conditions.

Read more at Yahoo Finance: The 4 Highest-Yielding S&P 500 Utility Stocks Are Strong 2026 Buys After Big Pullback