Investing.com — Scotiabank has identified its top picks among U.S. regulated utilities as the sector heads into earnings season, with analysts highlighting strong outlooks despite ongoing market headwinds. The bank’s top five selections are Entergy Corporation (ETR), CenterPoint Energy (CNP), Black Hills Corporation (BKH), NextEra Energy (NEE), and FirstEnergy Corp (FE), citing strong growth prospects and potential near-term catalysts.
According to Scotiabank, utilities are expected to deliver bullish updates and confident commentary on guidance and data center trends during the upcoming earnings season. However, analysts noted that favorable weather in the third quarter of 2026, combined with better-than-expected demand trends, should position most utilities to point toward the high end of their 2026 earnings guidance ranges.
Here are Scotiabank’s top regulated utility picks:
1. Entergy Corporation (ETR)
Scotiabank assigned a one-year target price of $121.00, representing a potential return of 17.6%. The company benefited from highly favorable weather conditions in the third quarter, with analysts expecting it to be among the largest beneficiaries of increased cooling degree days.
2. CenterPoint Energy (CNP)
With a target price of $46.00 and a potential return of 15.8%, CenterPoint is expected to provide better-than-expected updates. The company recently completed an internal electric transmission study driven by robust load growth, which may result in approximately $10 billion of capital expenditure upside moving into its formal outlook. Scotiabank noted opportunities related to data center development in Texas and Indiana, though risks remain elevated given political pushback.
3. Black Hills Corporation (BKH)
Scotiabank set a target price of $84.00, implying a 13.4% potential return. The company recently announced plans for a Wyoming buildout to serve Google, with management pointing to an approximately 35% earnings uplift by 2030. The company also benefited significantly from favorable third-quarter weather conditions.
4. NextEra Energy (NEE)
With the highest potential return at 27.3% and a target price of $99.00, NextEra has secured deals with the U.S., Japanese, and Korean governments to build new natural gas infrastructure to serve data centers. The company has already provided more than five years of capital expenditure guidance, and management expects near-term deal announcements by year-end.
Source: finance.yahoo.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.
