Back to top

Image: Bigstock

Are Utilities Stocks Lagging Telefonica (TEF) This Year?

Read MoreHide Full Article

Investors interested in Utilities stocks should always be looking to find the best-performing companies in the group. Telefonica (TEF - Free Report) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Utilities peers, we might be able to answer that question.

Telefonica is a member of the Utilities sector. This group includes 106 individual stocks and currently holds a Zacks Sector Rank of #2. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst.

The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Telefonica is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for TEF's full-year earnings has moved 29.5% higher. This is a sign of improving analyst sentiment and a positive earnings outlook trend.

According to our latest data, TEF has moved about 25.1% on a year-to-date basis. At the same time, Utilities stocks have gained an average of 9%. This means that Telefonica is performing better than its sector in terms of year-to-date returns.

One other Utilities stock that has outperformed the sector so far this year is United Utilities Group PLC (UUGRY - Free Report) . The stock is up 14.1% year-to-date.

In United Utilities Group PLC's case, the consensus EPS estimate for the current year increased 0.8% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Breaking things down more, Telefonica is a member of the Diversified Communication Services industry, which includes 15 individual companies and currently sits at #157 in the Zacks Industry Rank. This group has gained an average of 9% so far this year, so TEF is performing better in this area.

United Utilities Group PLC, however, belongs to the Utility - Electric Power industry. Currently, this 60-stock industry is ranked #50. The industry has moved +9.4% so far this year.

Investors interested in the Utilities sector may want to keep a close eye on Telefonica and United Utilities Group PLC as they attempt to continue their solid performance.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Telefonica SA (TEF) - free report >>

United Utilities Group PLC (UUGRY) - free report >>

Published in