3 High-Yield Utilities Stocks to Keep Your Portfolio Charged in 2024
High-yield utilities stocks are an essential addition to an investor’s portfolio because they provide exposure to an industry with reliable returns. Companies that offer electricity generation services are vital for a growing society and are beginning to expand into more renewable sources such as geothermal, wind, solar and hydroelectric power. The industry includes many companies for investors seeking high dividend yields.
A benchmark ETF that represents the utilities sector is the Utilities Select Sector SPDR Fund (NYSEARCA:XLU), which has $14 billion in assets under management. Its share price has fallen 12% this past year.
The utility stocks below are companies that have outperformed the industry. In addition, these stocks offer investors considerable dividend yields of over 4% annually.
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Entergy (ETR)
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Entergy (NYSE:ETR) distributes electricity to over 3 million customers in Southern U.S. states such as Louisiana, Texas, Arkansas and Mississippi. It also distributes natural gas and participates in decommissioning nuclear plants. Energy generation is done through multiple methods, including hydro, solar, natural gas, nuclear and coal power.
Over this past year, its share price dropped 8%, partly due to Entergy’s reduction in total revenue compared to the previous year. Its third-quarter earnings results for 2023, released on Nov. 1, stated that Entergy’s revenue had fallen 15%. Its net income grew 19% compared to the year before. Entergy reached a $484 million agreement to sell its natural gas transportation business to Bernhard Capital, a private equity firm in Louisana.
Entergy offers investors a solid annual dividend yield of approximately 4.60% annually, which has grown for almost 10 consecutive years. Its most recent quarterly dividend payout to investors was $1.13 per share.
The company offers investors reliable returns and a strong dividend yield. It’s currently trading at a reduced valuation, making it a decent candidate for utilities sector investors.
Enel Chile (ENIC)
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Enel Chile (NYSE:ENIC) is the largest electricity utility in Chile. It generates electricity through thermal, hydroelectric, wind and solar power. It serves residential and commercial customers.
Enel Chile offers investors a substantial dividend yield of just over 12% annually. Its most recent dividend payment to investors was $0.03 per share in January. The dividend payment before that was $0.32 per share in May of 2023, which makes their dividend distributions somewhat unreliable.
Its earnings results for the third quarter of 2023 stated that total sales decreased 20%. Its net income grew 55% compared to the year before. Its total electricity generation saw a slight increase due to Enel Chile bringing new power plants online. Operating revenue decreased due to several factors, including the sale of energy transmission business and lower energy sales.
Like Entergy, Enel Chile’s share price fell over 23% in the last six months due to several factors, including reduced electricity sales and the selling of the energy transmissions business. That offers investors a unique opportunity to purchase its stock when trading at a reduced valuation.
Edison International (EIX)
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Edison International (NYSE:EIX) is a large-cap electric utility company that produces energy for residential, commercial and industrial customers in Southern California.
The company’s price remained practically unchanged this past year. This was partially due to its reduced operating revenue of 10% compared to the previous year, as reported in its most recent earnings report for the third quarter.
Edison International offers a very reliable dividend payout of 4.61% annually, which has seen growth for eighteen consecutive years. Its most recent dividend payment is $0.78 per share, which will be distributed on Jan. 31.
The company is a large-cap utility positioned to help transfer Southern California over to an electricity generation landscape that is better for the environment, especially with the overwhelming issue of wildfires that plague that area of the U.S. The company’s future potential and stable dividend payout to investors make Edison International a good choice for investors going forward.
As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Noah has about a year of freelance writing experience. He’s worked with Investopedia dealing with topics such as the stock market and financial news.
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