Best UtilitiesStocks — Ranked by 5 Models
Electric utilities, gas distribution, water, and renewable energy producers.
Data as of
60 companies
Utilities Companies (60)
All Utilities Companies
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Start Free →How the five models treat Utilities
| Profile | Models | Fair value | Q / V / M / T |
|---|---|---|---|
| Utility |
| Justified P/E = payout × (1 + g)/(COE − g) on normalized EPS | 40% / 15% / 30% / 15% |
A model that does not apply is left out of the company's axis, never scored as zero. Full definitions on the methodology page.
Investing in Utilities Stocks
A debt load that would be alarming in most sectors is ordinary for a utility. Electric power companies, gas distributors, water utilities, and renewable energy producers finance massive infrastructure through bond markets and recover costs through regulated rate structures. Graham addressed this himself: for public utilities, chapter 14 replaces the working-capital test with a limit on debt relative to book equity, and AlphaStocks uses his utility test for them.
Utilities have their own profile. Greenblatt left utilities out of the Magic Formula, so it does not rate them; Piotroski, Buffett, Graham and Lynch do. Fair value is a justified P/E — a stable-growth dividend discount model on the utility's return on equity — because a regulated utility's value lies in the earnings its rate base allows.
Expect moderate composite scores. Utilities rarely generate the momentum that pushes a composite to the top of the range, because their stock prices move slowly by design. That's not a flaw in the scoring; it reflects a sector where stability is the value proposition. Focus on the Quality and Value axes for the most actionable signals, and treat the dividend yield as a core part of total return.
The clean energy transition is changing the utility investment thesis. Regulated utilities are deploying billions into solar, wind, battery storage, and grid modernization, which expands the rate base and can drive earnings growth. The models see this only as it reaches the filings — in returns on equity, owner earnings and debt — not the regulatory relationships behind it.
Utilities Stocks — Frequently Asked Questions
Why do utility stocks generally score lower than tech stocks?
Mostly momentum: utility prices move slowly, and momentum is ranked across the whole universe. Utilities also have one fewer Value model — Greenblatt does not rate them — so their Value axis rests on Graham and Lynch.
How does AlphaStocks handle the high debt levels of utilities?
With Graham's own rule for public utilities: debt is judged against book equity instead of the working-capital test he applies to industrial companies. The other models apply as written; Buffett's debt test, for example, still asks whether debt can be repaid from a few years of owner earnings.
Which utility metrics matter most for income investors?
Graham's uninterrupted-dividend and earnings records, Buffett's return-on-equity test, the dividend yield, and the fair value — a justified P/E built on the utility's return on equity — shown on each stock page with its range.