Can these 5 utility stocks weather inflation? DUK, SO, D, AEP & SRE

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 Can these 5 utility stocks weather inflation? DUK, SO, D, AEP & SRE
Image source: © Alexeynovikov | Megapixl.com
Highlights:
  • Duke Energy Corp (NYSE: DUK) reported revenue of US$7.13 billion in Q1, FY22.
  • The SO stock returned gains of over 9% YTD.
  • DBA Sempra (NYSE: SRE) reported a net income of US$657 million in Q1, FY21.

Utility stocks are companies that provide basic amenities like electricity, natural gas, water, and sewage disposal services to residential, commercial, industrial, and government consumers.

Since demand for such services remains stable even during an economic turmoil, investments in this sector are considered safe.

Utility firms generate steady income from long-term service contracts with the government with guaranteed payments. They also pay investors dividends with higher average yields.

The following are utility stocks that may be worth exploring amid inflation.

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Duke Energy Corporation (NYSE: DUK)

Duke is an electricity and natural gas holding company based in Charlotte, North Carolina. It operates through three segments: electric utilities, gas utilities, and commercial renewables.

The company’s shares traded at US$109.44 at 2:10 pm ET on June 9, down 0.95% from their previous close. Its stock value increased by 6.76% YTD (as of June 9).

It has a market capitalization of US$84.42 billion, a P/E ratio of 23.04, and a forward one-year P/E ratio of 20.20. Its current yield is 3.51%, and its annualized dividend is US$3.94.

The 52-week highest and lowest stock prices were US$116.33 and US$95.48, respectively. Its trading volume was 1,810,722 on June 8.

The company's total operating revenue was US$7.13 billion in Q1, FY22, compared to US$6.15 billion in the year-ago quarter. Its net income attributable to common shareholders was US$818 million, or US$1.08 per share, against an income of US$953 million, or US$1.25 per share in Q1, FY21.

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Top dividend-paying utility stocks to explore in JuneSource: ©2022 Kalkine Media®

Southern Company (NYSE: SO)

Southern Co. is a leading natural gas and electricity holding company based in Atlanta, Georgia.

The stock traded at US$74.15 at 2:16 pm ET on June 9, down 0.64% from its previous close. The SO stock rose 9.48% YTD (as of June 9).

Its market cap is US$78.93 billion, the P/E ratio is 34.39, and the forward one-year P/E ratio is 20.96. Its current yield is 3.59% and its annualized dividend is US$2.72. The stock touched a high of US$77.23 and a low of US$60.12 in a year. Its share volume on June 8 was 2,981,627.

The company posted a revenue of US$6.64 billion in Q1, FY22, compared to US$5.91 billion in the same quarter of the previous year. Its attributable net income came in at US$1.03 billion, compared to US$1.13 billion in Q1, FY21.

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Dominion Energy, Inc. (NYSE: D)

Dominion Energy is a power and energy firm specializing in electricity, natural gas, and related services to customers. The company is based in Richmond, Virginia.

Its shares traded at US$80.43 at 2:20 pm ET on June 9, down 0.94% from their previous close. Its stock price rose 3.62% YTD (as of June 9).

It has a market cap of US$65.38 billion, a P/E ratio of 22.51, and a forward one-year P/E ratio of 19.75. Its current yield is 3.21%, and its annualized dividend is US$2.67.

The 52-week highest and lowest stock prices were US$88.78 and US$70.37, respectively. Its trading volume was 2,240,326 on June 8.

The total operating revenue was US$4.27 billion in Q1, FY22, compared to US$3.87 billion in the year-ago quarter. Its net income was US$711 million, versus US$1.008 billion in Q1, FY21.

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American Electric Power Company, Inc. (NASDAQ: AEP)

American Electric Power is an electric utility holding firm providing services in various US locations. It is based in Columbus, Ohio.

The stock traded at US$99.79 at 2:23 pm ET on June 9, down 0.74% from its previous close. The AEP stock gained 13.45% YTD (as of June 9).

Its market cap is US$51.35 billion, the P/E ratio is 19.12, and the forward one-year P/E ratio is 20.07. Its current yield is 3.05%, and its annualized dividend is US$3.12.

The stock touched a peak price of US$104.81 and the lowest price of US$80.22 in the last 52 weeks. Its share volume on June 8 was 1,814,506.

The company reported revenue of US$4.6 billion in Q1, FY22, compared to US$4.3 billion in the year-ago period. Its GAAP net income was US$714.7 million, against US$575.0 billion in Q1, FY21.

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Top utility stocks: DUK, SO, D, AEP, SRE

DBA Sempra (NYSE: SRE)

Sempra Energy is an energy infrastructure firm focusing on electricity and natural gas infrastructure. It is based in San Diego, California.

Its shares traded at US$157.25 at 2:27 pm ET on June 9, down 1.38% from their previous close. The stock value increased by 20.8% YTD (as of June 9).

The firm has a market cap of US$49.46 billion, a P/E ratio of 49.64, and a forward one-year P/E ratio of 18.80. Its current yield is 2.8%, and its annualized dividend is US$4.58.

The 52-week highest and lowest stock prices were US$173.28 and US$119.56, respectively. Its trading volume was 1,237,559 on June 8.

The revenue was US$3.82 billion in Q1, FY22, compared to US$3.25 billion in the first quarter of fiscal 2021. Its net income was US$657 million, against an income of US$928 million in Q1, FY21.

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Bottom line:

The S&P 500 Utilities Index rose 2.30% YTD and jumped 13.43% in the past 12 months. However, investors should exercise due diligence before investing in the stock market.

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