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Here's Why You Should Add Xcel Energy (XEL) to Your Portfolio

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Earnings estimates for Xcel Energy Inc. (XEL - Free Report) have been revised upward in the past 60 days, reflecting analysts’ optimism on the stock. The Zacks Consensus Estimate for 2019 earnings has inched up 0.4% during the said period.

Xcel Energy,through its subsidiaries, engages primarily in the generation, purchase, transmission, distribution and sale of electricity in the United States.

Let’s focus on the factors that make Xcel Energy an appropriate investment option at the moment.

Price Movement

In the past 12 months, Xcel Energy’s shares have gained 27.3% compared with the industry’s rise of 14.1%.

Earnings & Revenue Estimate Revision

Xcel Energy’s earnings estimate for 2019 and 2020 indicate rise of 6.07% and 6.41% on a year-over-year basis to $2.62 and $2.79 per share, respectively.

Revenue estimate for 2019 and 2020 indicate increase of 3.71% and 2.89% on a year-over-year basis to $11.96 billion and $12.31 billion, respectively.

Return on Equity (ROE)

Xcel Energy’ has an ROE of 10.60% compared with the industry average of 9.18%, which indicates efficiency in utilizing shareholders’ funds.

Long-Term Growth and Dividend Yield

The company’s long-term (three to five years) earnings growth is pegged at 5.93%, courtesy of investment in regulated natural gas and renewable energy assets as well as favorable state economies in its service territories.

Currently, the company has a dividend yield of 2.68% compared with the Zacks S&P 500 Composite’s 1.96%.

Zacks Rank & Other Key Picks

Xcel Energy currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other top-ranked stocks from the same industry are NextEra Energy, Inc (NEE - Free Report) , The Southern Company (SO - Free Report) and IDACORP (IDA - Free Report) , each holding a Zacks Rank of 2.

NextEra Energy pulled off an average positive earnings surprise of 2.52% in the last four quarters. The company’s long-term (three to five years) earnings growth is pegged at 2.52%

The Southern Company pulled off an average positive earnings surprise of 7.85% in the last four quarters. The company’s long-term (three to five years) earnings growth is pegged at 4.50%

IDACORP pulled off an average positive earnings surprise of 9.60% in the last four quarters. The company’s long-term (three to five years) earnings growth is pegged at 2.60%

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