Utility stocks can be an excellent instrument to hold for the longer term. They have very stable and predictable business models, and they also pay reasonably good dividends. Most utility companies have decade-long records of paying uninterrupted dividends, while many have consistently increased those dividend payments over the years. What utility stocks do not offer is high capital gains. They are slow-growth companies that generally rise in demand for electricity, water, natural gas, or other basic energy needs. This growth tends to be influenced by the population growth in the area where the utility company is operating. So, migration and a growing local economy are factors that can boost the demand for utility services. Among the top 10 utility companies in the US, Eversource Energy is the largest in the New England area. If you want to buy utility stock today, then it may be worth exploring the company further.
Eversource Energy Reports Q12021 Earnings Results
On 10th May 2021, Eversource Energy reported its first-quarter 2021 earnings results. Earnings per share rose marginally from $1.01 in Q12020 to $1.06. The company also disclosed that its customer base stood at 4.3 million. The electric distribution segment saw a significant drop in earnings, with segment earnings per share falling from $0.39 in Q12020 to $0.27. In contrast, the natural gas distribution segment performed the best. Earnings per share for the part rose from $0.26 in Q12020 to $0.43. The fall in electric distribution earnings was mainly attributed to a $30 million charge reflecting customer credits and a $1.6 million penalty paid to the state of Connecticut. Storm-related expenses also played a part in the drop in earnings. The Natural Gas segment grew 50% on a year-on-year basis, a plus point for the company. Eversource Energy is an exciting proposition for long term utility stocks.
Eversource Energy is making significant strides in decarbonization. It is the only energy company in the US committed to going carbon neutral as early as 2030. The stock closed at $83.3 on 24th May 2021.