The companies in the Zacks Utility - Gas Distribution provide natural gas transportation services from production regions through pipeline networks and serve millions of customers across the United States. These utilities, with their regulated business structure, recover expenses through approved rate hikes while supporting shareholder returns through dividends and share repurchases.

The demand for natural gas is rising in the United States due to its relatively lower emissions compared with other fossil fuels. Companies operating under this utility sector use widespread transmission and distribution lines and interstate pipelines to serve the demand of all customer groups.

Amid the rising importance of gas distribution, let us discuss MDU Resources Group, Inc. (MDU Quick QuoteMDU - Free Report) and Chesapeake Utilities Corporation (CPK Quick QuoteCPK - Free Report) , two regulated utilities that are well-positioned to benefit from rising natural gas demand and major infrastructure development investments, making them comparable in the utility space.

MDU Resources, engaged in regulated energy delivery businesses, serves more than 1.2 million electric and natural gas customers across the United States. MDU manages nearly 3,800 miles of regulated pipe with 14 interconnection points. The company is benefiting from rising service demand, an expanding customer base, the implementation of new rates and pipeline expansion projects that continue to support its financial performance. Its systematic capital investments in infrastructure development enhance service reliability and boost long-term financial growth.

Chesapeake Utilities is a regulated energy delivery business that efficiently serves millions of electric and natural gas customers across the United States. CPK operated approximately 11,295 miles of regulated energy infrastructure assets as of Dec. 31, 2025. The company is benefiting from rising natural gas demand, new rates and an expanding customer base driven by economic growth in its service territory, boosting revenue growth. The company’s strategic capital investment in infrastructure development ensures safe and reliable service to customers and supports long-term growth.

Let’s examine their fundamentals side by side to reveal which stock presents the most attractive investment opportunity.

CPK & MDU’s Earnings Growth Projection

The Zacks Consensus Estimate for CPK’s earnings per share (EPS) is pegged at $6.51 in 2026 and $7.39 in 2027, suggesting year-over-year growth of 8.32% and 13.52%, respectively.  

The Zacks Consensus Estimate for MDU’s EPS is pegged at 98 cents in 2026 and $1.05 in 2027, suggesting year-over-year growth of 5.38% and 7.65%, respectively.  

CPK & MDU’s Return on Equity

Return on Equity (“ROE”) measures how efficiently a company utilizes shareholders’ funds to generate return, with a higher ROE indicating stronger operational efficiency and value creation. ROE plays a significant role in measuring a company's financial health and management effectiveness in generating returns from available resources.

Chesapeake Utilities’ current ROE of 9.53% is higher than MDU Resources' ROE of 6.82%. CPK utilizes shareholder capital more efficiently and generates higher profits, though both companies’ returns remain below the industry average of 10.13%.

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CPK & MDU’s Dividend Yield

Utility companies consistently reward shareholders with regular dividend payments, reflecting their commitment to providing steady returns on invested capital. This highlights the company’s earnings stability and strong cash flow generation capabilities.

Currently, the dividend yield for MDU Resources is 2.67%, while that for Chesapeake Utilities is 2.23%. The dividend yields of both companies are higher than the S&P 500’s yield of 1.45%.

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CPK & MDU’s Debt to Capital

The Zacks Utilities sector is a capital-intensive one and requires continuous investments in infrastructure upgrades and maintenance to ensure operational efficiency and support growing demand. These utilities fund long-term investments through a combination of internally generated cash flows and capital market financing, supporting growth and reliable service.

MDU Resources’ debt-to-capital currently stands at 47.20% compared with Chesapeake Utilities’ 50.12%. Both companies are using debt to fund their business and remain below the industry average of 54.47%. CPK's debt level surpasses MDU, highlighting its greater reliance on debt financing.

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CPK & MDU’s Capital Investment Plans

MDU Resources aims to invest $565 million in 2026 and $3.1 billion in 2026-2030 to support infrastructure development and to enhance service reliability for its expanding customer base. 

Chesapeake Utilities plans to invest $450-$500 million in 2026 to expand its distribution and transmission infrastructure, enhance service reliability and support long-term growth. The company also expects to invest $1.5-$1.8 billion during 2024-2028.

CPK & MDU’s Price Performance

MDU Resources shares have gained 27.2% in the past year compared with Chesapeake Utilities’ 4.3% growth.

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Overall Assessment

MDU Resources and Chesapeake Utilities both benefit from expanding customer base, rising service demand, and are investing systematically in infrastructure maintenance and upgradation to provide safe and reliable service to millions of customers across the United States.

However, our choice at the moment is MDU, given its better dividend yield, lower debt-to-capital ratio and better price performance than CPK.  Both MDU and CPK carry a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.