Best Utility Stocks to Buy for March 2026

Best Utility Stocks to Buy for March 2026

Kevin Voigt

VIVRWEOYLUMNPNWAQN

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Key Takeaways

  • The utilities sector includes electric, gas, and water providers that operate in regulated markets.
  • As utility stocks offer predictable revenue, they are seen as defensive holdings in a diversified portfolio.
  • Top utility stocks to buy now include Telefônica Brasil, RWE and Lumen Technologies.

Utility stocks have long served as a cornerstone for conservative investors seeking income, relative stability, and downside protection. In periods of economic uncertainty, their regulated business models and consistent cash flows tend to stand out. Now, as interest rate expectations evolve and electricity demand accelerates from AI data centers, broader electrification, and renewable energy expansion, the sector is drawing renewed attention in 2026.

Below is a comprehensive guide to the best utility stocks, highlighting high performers, leading dividend payers, potentially undervalued opportunities, and companies with durable long term compounding potential.

Utility Stock Market Overview and Forecast

The utilities sector includes electric, gas, and water providers that operate in regulated markets. Because these companies generate predictable revenue streams, they are often seen as defensive holdings within a diversified portfolio.

In 2026, several forces are shaping the sector:

  • Rising electricity demand from data centers and AI infrastructure.
     
  • Grid modernization and renewable energy investments.
     
  • Interest-rate stabilization after prior tightening cycles.
     
  • Increased focus on ESG and decarbonization initiatives.
     

Utilities have historically outperformed during volatile or slowing markets, though they can lag in strong bull runs when investors favor higher growth sectors. Even so, improving earnings outlooks and capital investment plans are helping narrow that performance gap.

Is Now a Good Time to Invest in Utility Stocks?

Many analysts suggest utilities may benefit if interest rates stabilize or decline. Lower borrowing costs can improve margins because utilities rely heavily on debt financing for infrastructure projects. Meanwhile, steady dividend yields — often ranging between 3% and 6% — remain attractive compared to broader market averages.

Below, we examine and rank leading utility stocks using a blend of Zacks Rank signals, Style Scores, and core fundamental metrics to identify companies that may offer compelling long term opportunities for patient investors.

Company (Ticker)12 Week Price ChangeForward PEPriceProj EPS Growth (1 Year)Projected Sales Growth (1Y)Report
Telefonica Brasil (VIV)29.82%18.37$15.7827.21%12.02%
RWE AG (RWEOY)20.61%19.51$61.0916.30%NA
Lumen Technologies (LUMN)-20.95%NA$6.6219.23%-12.36%Free Research Report: LUMN
Pinnacle West Capital (PNW)17.33%21.64$102.44-6.88%4.05%Free Research Report: PNW
Algonquin Power & Utilities (AQN)17.41%18.85$6.0815.87%2.77%

*Updated on March 6, 2026.

Telefonica Brasil (VIV)

$15.78 USD -0.11 (-0.69%)

3-Year Stock Price Performance

3 Year Stock Price Performance Chart for VIV

Premium Research for VIV

Zacks Rank

This is our short term rating system that serves as a timeliness indicator for stocks over the next 1 to 3 months. How good is it? See rankings and related performance below.

Zacks Rank Definition Annualized Return
1Strong Buy23.86%
2Buy18.17%
3Hold10.12%
4Sell5.62%
5Strong Sell2.90%
S&P50011.43%

Zacks Rank Education - Learn about the Zacks Rank

Zacks Rank Home - Zacks Rank resources in one place

Zacks Premium - The only way to fully access the Zacks Rank

Trending upward Strong Buy 1
Zacks Industry Rank

The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank.

An industry with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Industry Rank Education -- Learn more about the Zacks Industry Rank

Top 29% (71 out of 243)
Zacks Sector Rank

The Zacks Sector Rank assigns a rating to each of the 16 Sectors based on their average Zacks Rank.

A sector with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

Zacks Sector Rank Education - Learn more about the Zacks Sector Rank

The sector with the best average Zacks Rank would be considered the top sector (1 out of 16), which would place it in the top 1% of Zacks Ranked Sectors. The sector with the worst average Zacks Rank (16 out of 16) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Sector Rank Education -- Learn more about the Zacks Sector Rank

Top 31% (5 out of 16)
Style Scores

The Style Scores are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style.

The scores are based on the trading styles of Value, Growth, and Momentum. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score.

  • Value Score A
  • Growth Score A
  • Momentum Score A
  • VGM Score A

Within each Score, stocks are graded into five groups: A, B, C, D and F. As you might remember from your school days, an A, is better than a B; a B is better than a C; a C is better than a D; and a D is better than an F.

As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.

Zacks Style Scores Education - Learn more about the Zacks Style Scores

B Value C Growth B Momentum B VGM

Earnings ESP

Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity. The idea is that more recent information is, generally speaking, more accurate and can be a better predictor of the future, which can give investors an advantage in earnings season.

The technique has proven to be very useful for finding positive surprises. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time, while they also saw 28.3% annual returns on average, according to our 10 year backtest.

Visit the Earnings ESP Center

See the Full List of Stocks To Beat Earnings

0.00%
  • Market Cap:$27.51 B (Large Cap)
  • Projected EPS Growth:27.94%
  • Last Quarter EPS Growth:0.00%
  • Last EPS Surprise:29.41%
  • Next EPS Report date:May 11, 2026

Our Take:

Reasons to Buy

Telefônica Brasil runs large mobile and fiber networks in Brazil, a utility-like infrastructure business built on recurring service fees. In Q4 2025, its consumer-facing brand, Vivo, cited postpaid and fiber momentum and a rising B2B revenue mix, while highlighting stronger cash generation as spending discipline improved. The dividend policy adds a defensive angle if macro volatility returns.

Potential Risks

Brazil’s telecom market is competitive. As such, promotions can squeeze pricing and churn can rise. Capex and spectrum needs can pressure free cash flow if inflation turns unfriendly.

Forecast

A Zacks Rank #1 (Strong Buy) with Style Scores of B for Value and C for Growth and Momentum suggests revisions are favorable, even without a factor “sweet spot.” The Price, Consensus & EPS Surprise chart puts 2026 in focus as the EPS consensus ticks higher, and that upward revision trend lines up with firmer price action.

Free Research Report: VIV

RWE AG (RWEOY)

$61.09 USD -0.18 (-0.29%)

3-Year Stock Price Performance

3 Year Stock Price Performance Chart for RWEOY

Premium Research for RWEOY

Zacks Rank

This is our short term rating system that serves as a timeliness indicator for stocks over the next 1 to 3 months. How good is it? See rankings and related performance below.

Zacks Rank Definition Annualized Return
1Strong Buy23.86%
2Buy18.17%
3Hold10.12%
4Sell5.62%
5Strong Sell2.90%
S&P50011.43%

Zacks Rank Education - Learn about the Zacks Rank

Zacks Rank Home - Zacks Rank resources in one place

Zacks Premium - The only way to fully access the Zacks Rank

Trending upward Strong Buy 1
Zacks Industry Rank

The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank.

An industry with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Industry Rank Education -- Learn more about the Zacks Industry Rank

Top 36% (87 out of 243)
Zacks Sector Rank

The Zacks Sector Rank assigns a rating to each of the 16 Sectors based on their average Zacks Rank.

A sector with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

Zacks Sector Rank Education - Learn more about the Zacks Sector Rank

The sector with the best average Zacks Rank would be considered the top sector (1 out of 16), which would place it in the top 1% of Zacks Ranked Sectors. The sector with the worst average Zacks Rank (16 out of 16) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Sector Rank Education -- Learn more about the Zacks Sector Rank

Top 31% (5 out of 16)
Style Scores

The Style Scores are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style.

The scores are based on the trading styles of Value, Growth, and Momentum. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score.

  • Value Score A
  • Growth Score A
  • Momentum Score A
  • VGM Score A

Within each Score, stocks are graded into five groups: A, B, C, D and F. As you might remember from your school days, an A, is better than a B; a B is better than a C; a C is better than a D; and a D is better than an F.

As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.

Zacks Style Scores Education - Learn more about the Zacks Style Scores

C Value F Growth C Momentum D VGM

Earnings ESP

Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity. The idea is that more recent information is, generally speaking, more accurate and can be a better predictor of the future, which can give investors an advantage in earnings season.

The technique has proven to be very useful for finding positive surprises. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time, while they also saw 28.3% annual returns on average, according to our 10 year backtest.

Visit the Earnings ESP Center

See the Full List of Stocks To Beat Earnings

0.00%
  • Market Cap: $46.67 B (Large Cap)
  • Projected EPS Growth: -20.12%
  • Last Quarter EPS Growth:90.70%
  • Last EPS Surprise: 412.50%
  • Next EPS Report date: March 19, 2026

Our Take:

Reasons to Buy

RWE is a European power producer and renewables developer, giving it utility exposure through generation and contracted clean assets. In its latest 2025 update, the company signaled strong performance, especially in Onshore Wind / Solar and capacity growth, while investment continues. The renewables fleet under construction adds revenue visibility, while governments continue to support green energy. The dividend reads as modest but supportive for a transition story.

Potential Risks

Results swing with power prices, weather and hedging. Europe’s evolving market rules can reshape returns. The build-out also raises execution and balance-sheet risk.

Forecast

A Zacks Rank #1 suggests earnings estimates are moving the right way, though C for Value, F for Growth and D for Momentum imply mixed factor support. The chart shows 2025–2026 EPS consensus mostly steady after prior cuts, then a late upside surprise as price accelerates.

Free Research Report: RWEOY

Lumen Technologies (LUMN)

$6.62 USD -0.21 (-3.07%)

3-Year Stock Price Performance

3 Year Stock Price Performance Chart for LUMN

Premium Research for LUMN

Zacks Rank

This is our short term rating system that serves as a timeliness indicator for stocks over the next 1 to 3 months. How good is it? See rankings and related performance below.

Zacks Rank Definition Annualized Return
1Strong Buy23.86%
2Buy18.17%
3Hold10.12%
4Sell5.62%
5Strong Sell2.90%
S&P50011.43%

Zacks Rank Education - Learn about the Zacks Rank

Zacks Rank Home - Zacks Rank resources in one place

Zacks Premium - The only way to fully access the Zacks Rank

Trending upward Strong Buy 1
Zacks Industry Rank

The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank.

An industry with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Industry Rank Education -- Learn more about the Zacks Industry Rank

Top 29% (71 out of 243)
Zacks Sector Rank

The Zacks Sector Rank assigns a rating to each of the 16 Sectors based on their average Zacks Rank.

A sector with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

Zacks Sector Rank Education - Learn more about the Zacks Sector Rank

The sector with the best average Zacks Rank would be considered the top sector (1 out of 16), which would place it in the top 1% of Zacks Ranked Sectors. The sector with the worst average Zacks Rank (16 out of 16) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Sector Rank Education -- Learn more about the Zacks Sector Rank

Top 31% (5 out of 16)
Style Scores

The Style Scores are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style.

The scores are based on the trading styles of Value, Growth, and Momentum. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score.

  • Value Score A
  • Growth Score A
  • Momentum Score A
  • VGM Score A

Within each Score, stocks are graded into five groups: A, B, C, D and F. As you might remember from your school days, an A, is better than a B; a B is better than a C; a C is better than a D; and a D is better than an F.

As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.

Zacks Style Scores Education - Learn more about the Zacks Style Scores

B Value C Growth D Momentum A VGM

Earnings ESP

Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity. The idea is that more recent information is, generally speaking, more accurate and can be a better predictor of the future, which can give investors an advantage in earnings season.

The technique has proven to be very useful for finding positive surprises. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time, while they also saw 28.3% annual returns on average, according to our 10 year backtest.

Visit the Earnings ESP Center

See the Full List of Stocks To Beat Earnings

0.00%
  • Market Cap:$7.28 B (Mid Cap)
  • Projected EPS Growth:15.38%
  • Last Quarter EPS Growth:215.00%
  • Last EPS Surprise:209.52%
  • Next EPS Report date:May 7, 2026

Our Take:

Reasons to Buy

Lumen owns extensive U.S. fiber networks, an infrastructure-heavy “utility” for enterprises and carriers. In Q4 2025, the company said revenue, EBITDA and free cash flow were in line, highlighting balance-sheet improvement following its AT&T transaction, alongside traction in higher-value enterprise services, including new PCF contracts and a growing network-as-a-service base. The investment case rests on operating leverage if the mix keeps shifting toward fiber-led products.

Potential Risks

Lumen is still a turnaround, so ongoing legacy revenue erosion and refinancing risk can pressure the stock if execution falters. Intense competition and any lag in contract conversion could squeeze cash flow.

Forecast

A Zacks Rank #1 with B for Value and Growth and A for Momentum signals revisions and price action are aligned. The chart shows 2026 EPS still negative but steadier, then a 2027 step-up, with mixed surprises improving recently.

Free Research Report: LUMN

Pinnacle West Capital (PNW)

$102.44 USD +0.66 (0.65%)

3-Year Stock Price Performance

3 Year Stock Price Performance Chart for PNW

Premium Research for PNW

Zacks Rank

This is our short term rating system that serves as a timeliness indicator for stocks over the next 1 to 3 months. How good is it? See rankings and related performance below.

Zacks Rank Definition Annualized Return
1Strong Buy23.86%
2Buy18.17%
3Hold10.12%
4Sell5.62%
5Strong Sell2.90%
S&P50011.43%

Zacks Rank Education - Learn about the Zacks Rank

Zacks Rank Home - Zacks Rank resources in one place

Zacks Premium - The only way to fully access the Zacks Rank

Trending downward Hold 3
Zacks Industry Rank

The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank.

An industry with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Industry Rank Education -- Learn more about the Zacks Industry Rank

Top 36% (87 out of 243)
Zacks Sector Rank

The Zacks Sector Rank assigns a rating to each of the 16 Sectors based on their average Zacks Rank.

A sector with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

Zacks Sector Rank Education - Learn more about the Zacks Sector Rank

The sector with the best average Zacks Rank would be considered the top sector (1 out of 16), which would place it in the top 1% of Zacks Ranked Sectors. The sector with the worst average Zacks Rank (16 out of 16) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Sector Rank Education -- Learn more about the Zacks Sector Rank

Top 31% (5 out of 16)
Style Scores

The Style Scores are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style.

The scores are based on the trading styles of Value, Growth, and Momentum. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score.

  • Value Score A
  • Growth Score A
  • Momentum Score A
  • VGM Score A

Within each Score, stocks are graded into five groups: A, B, C, D and F. As you might remember from your school days, an A, is better than a B; a B is better than a C; a C is better than a D; and a D is better than an F.

As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.

Zacks Style Scores Education - Learn more about the Zacks Style Scores

B Value D Growth D Momentum C VGM

Earnings ESP

Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity. The idea is that more recent information is, generally speaking, more accurate and can be a better predictor of the future, which can give investors an advantage in earnings season.

The technique has proven to be very useful for finding positive surprises. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time, while they also saw 28.3% annual returns on average, according to our 10 year backtest.

Visit the Earnings ESP Center

See the Full List of Stocks To Beat Earnings

-80.00%
  • Market Cap: $12.13 B (Large Cap)
  • Projected EPS Growth:-6.93%
  • Last Quarter EPS Growth: -96.17%
  • Last EPS Surprise: 160.00%
  • Next EPS Report date:May 7, 2026

Our Take:

Reasons to Buy

Pinnacle West’s APS utility serves fast-growing Arizona, so earnings are largely set by regulated rate base and customer demand. In Q4 2025, the company cited robust customer and sales growth and reliable operations, a constructive setup as load continues to rise. The dividend looks solid for a regulated utility, and the fleet, anchored by the Palo Verde nuclear stake, adds durability.

Potential Risks

The regulatory calendar matters: rate-case outcomes, allowed ROE and cost-recovery timing can reset earnings power. Extreme heat, wildfire exposure and storm costs can raise operating and maintenance costs.

Forecast

A Zacks Rank #2 (Buy) with B for Value, C for Growth and F for Momentum suggests supportive fundamentals without broad factor sponsorship. The chart shows 2025–2027 EPS expectations nudging higher after a dip, with a mostly positive surprise pattern and a recent price move, evidence that estimates can firm if regulators cooperate.

Free Research Report: PNW

Algonquin Power & Utilities (AQN)

$6.08 USD -0.80 (-11.63%)

3-Year Stock Price Performance

3 Year Stock Price Performance Chart for AQN

Premium Research for AQN

Zacks Rank

This is our short term rating system that serves as a timeliness indicator for stocks over the next 1 to 3 months. How good is it? See rankings and related performance below.

Zacks Rank Definition Annualized Return
1Strong Buy23.86%
2Buy18.17%
3Hold10.12%
4Sell5.62%
5Strong Sell2.90%
S&P50011.43%

Zacks Rank Education - Learn about the Zacks Rank

Zacks Rank Home - Zacks Rank resources in one place

Zacks Premium - The only way to fully access the Zacks Rank

Buy 2
Zacks Industry Rank

The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank.

An industry with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Industry Rank Education -- Learn more about the Zacks Industry Rank

Top 36% (87 out of 243)
Zacks Sector Rank

The Zacks Sector Rank assigns a rating to each of the 16 Sectors based on their average Zacks Rank.

A sector with a larger percentage of Zacks Rank #1's and #2's will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4's and #5's.

Zacks Sector Rank Education - Learn more about the Zacks Sector Rank

The sector with the best average Zacks Rank would be considered the top sector (1 out of 16), which would place it in the top 1% of Zacks Ranked Sectors. The sector with the worst average Zacks Rank (16 out of 16) would place in the bottom 1%.

Zacks Rank Education -- Learn more about the Zacks Rank
Zacks Sector Rank Education -- Learn more about the Zacks Sector Rank

Top 31% (5 out of 16)
Style Scores

The Style Scores are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style.

The scores are based on the trading styles of Value, Growth, and Momentum. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score.

  • Value Score A
  • Growth Score A
  • Momentum Score A
  • VGM Score A

Within each Score, stocks are graded into five groups: A, B, C, D and F. As you might remember from your school days, an A, is better than a B; a B is better than a C; a C is better than a D; and a D is better than an F.

As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.

Zacks Style Scores Education - Learn more about the Zacks Style Scores

C Value D Growth F Momentum D VGM

Earnings ESP

Zacks Earnings ESP (Expected Surprise Prediction) looks to find companies that have recently seen positive earnings estimate revision activity. The idea is that more recent information is, generally speaking, more accurate and can be a better predictor of the future, which can give investors an advantage in earnings season.

The technique has proven to be very useful for finding positive surprises. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time, while they also saw 28.3% annual returns on average, according to our 10 year backtest.

Visit the Earnings ESP Center

See the Full List of Stocks To Beat Earnings

-7.69%
  • Market Cap: $5.36 B (Mid Cap)
  • Projected EPS Growth:6.67%
  • Last Quarter EPS Growth: 125.00%
  • Last EPS Surprise:50.00%
  • Next EPS Report date:March 6, 2026

Our Take:

Reasons to Buy

Algonquin pairs regulated electric, gas and water utilities with renewables, supporting recurring cash flows. In the last reported quarter, management reported year-over-year improvement in adjusted earnings and pointed to cost discipline and constructive regulatory progress, helped by implemented rates in the Regulated Services group. After the dividend reset, the payout still looks solid for investors who want income with a recovery angle.

Potential Risks

Renewable output and project timing can be uneven, and leverage plus higher rates can pressure flexibility during a capex cycle. Adverse rulings, lagging cost recovery, or normalizing weather can also weigh on earnings.

Forecast

A Zacks Rank #2 suggests revisions are improving, but C for Value, D for Growth and F for Momentum indicate limited factor support. The chart shows 2025–2026 EPS estimates stabilizing after earlier cuts, 2027 drifting higher, and surprises turning more favorable as the price grinds up.

Free Research Report: AQN

Methodology

The Zacks Rank is a proprietary stock-rating model that uses trends in earnings estimate revisions and earnings-per-share (EPS) surprises to classify stocks into five groups: #1 (Strong Buy), #2 (Buy), #3 (Hold), #4 (Sell) and #5 (Strong Sell). The Zacks Rank is calculated through four primary factors related to earnings estimates: analysts' consensus on earnings estimate revisions, the magnitude of revision change, the upside potential and estimate surprise (or the degree in which earnings per share deviated from the previous quarter). 

Zacks builds the data from 3,000 analysts at over 150 different brokerage firms. The average yearly gain for Zacks Rank #1 (Strong Buy) stocks is +23.62% per year from January, 1988, through June 2, 2025.

Selections for Best Utility Stocks are based on the current top ranking stocks based on Zacks Indicator Score, Style Scores and fundamentals. All stocks have a daily trading volume of at least 100,000 shares and have a stock price of at least $5. All information is current as of market open, March 2, 2026.

Guide to Best Utility Stocks: What Are Utility Stocks?

Utility stocks represent companies that provide essential services like electricity, natural gas, and water to residential and commercial customers.

How Do Utility Stocks Work?

Most utilities operate as regulated monopolies within defined geographic areas. State regulators set allowable rates of return, creating predictable revenue streams in exchange for infrastructure investment.

Why Do People Invest in Utility Stocks?

  • Reliable dividend income.
     
  • Lower volatility relative to growth stocks.
     
  • Defensive performance during economic slowdowns.
     

How Often Do Utility Stocks Pay Dividends in a Year?

Most U.S. utility companies pay dividends quarterly (four times per year).

Pros of Utility Stocks

  • Stable cash flow.
     
  • Recession resilience.
     
  • Attractive dividend yields.
     
  • Essential-service demand.
     

Cons of Utility Stocks

  • Interest-rate sensitivity.
     
  • Heavy capital expenditure needs.
     
  • Regulatory risk.
     
  • Slower growth compared to tech sectors.
     

Utility ETFs vs Utility Stocks

Investors can choose individual stocks or diversified ETFs.

Best Utility ETFs

  • Utilities Select Sector SPDR Fund (XLU)
     
  • Vanguard Utilities ETF (VPU)
     
  • iShares U.S. Utilities ETF (IDU)
     

ETFs offer instant diversification, while individual stocks may provide higher upside potential.

How to Choose the Best Utility Stocks

Consider:

  • Dividend yield and payout ratio.
     
  • Earnings and revenue consistency.
     
  • Regulatory environment strength.
     
  • Debt levels and credit ratings.
     
  • Renewable transition strategy.
     
  • Long-term infrastructure growth plans.
     

What Are the Utility Stocks That Are Good Investments?

Electric: Duke Energy (DUK), NextEra Energy (NEE).
Water: American Water Works (AWK).
Gas: Atmos Energy (ATO).
ESG-friendly: Xcel Energy (XEL), NextEra Energy (NEE).

How to Buy Utility Stocks

  1. Open a brokerage account.
     
  2. Research financials and dividend history.
     
  3. Decide between individual stocks or ETFs.
     
  4. Monitor regulatory developments and earnings reports.
     

Tips for Building a Utility Portfolio

  • Blend high-yield and growth utilities.
     
  • Diversify across electric, gas, and water.
     
  • Include at least one ETF for balance.
     
  • Reinvest dividends for compounding.
     

Frequently Asked Questions About Utility Stocks

How Are Utility Dividends Taxed?

Most are qualified dividends taxed at long-term capital gains rates, though investors should verify individual tax situations.

Are Utility Stocks Safe During Recessions?

Historically, utilities have outperformed the broader market during downturns because demand for electricity and water remains steady.

What’s a Good Dividend Yield for Utility Stocks?

According to industry rankings from research firms like Zacks, many electric utilities historically yield between 3% and 5%, higher than the broader S&P 500 average.

Are Utility Stocks Safe for Beginners?

Yes, they are often considered beginner-friendly due to predictable earnings and dividends.

Are Utility Stocks Good for Passive Income?

They are widely used in income-focused portfolios because of consistent quarterly payouts.

How Do Utility Stocks Perform During Market Downturns?

They typically decline less than high-growth sectors but may still experience volatility during severe selloffs.

Is Now a Good Time to Invest in Utility Stocks?

With rising electricity demand and potential interest-rate stabilization, 2025 presents favorable conditions for selective utility investments.

How Do Rising Interest Rates Affect Utility Stocks?

Higher rates can pressure valuations because utilities rely heavily on debt and compete with bond yields for income-focused investors.

Bottom Line

The best utility stocks in March 2025 combine reliable dividends, manageable debt, constructive regulatory environments, and exposure to long-term electrification trends. Whether you prioritize income, growth, or retirement stability, utilities remain a foundational sector for diversified portfolios.

 

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