13 Best Utility Stocks to Buy According to Analysts

4. Talen Energy Corporation (NASDAQ:TLN)

Average estimated analysts’ upside: 27.85%

Number of Hedge Fund Holders: 77

​Talen Energy Corporation (NASDAQ:TLN) is an independent power producer and energy infrastructure company that owns and operates approximately 10.7 gigawatts of power generation across the US. Its fleet comprises nuclear, natural gas, coal, and oil-fired facilities primarily situated in the Mid-Atlantic region and Montana, where it sells electricity into wholesale US power markets. With a 27.85% average analysts’ upside, TLN is one of the best utility stocks included on our list.

Talen Energy Corporation (NASDAQ:TLN) delivered strong financial results in 2024, generating $770 million in adjusted EBITDA and $283 million in adjusted free cash flow, while achieving record levels of safety and reliability. The company has reaffirmed its 2025 guidance with an adjusted EBITDA range of $925 million to $1.175 billion and an adjusted free cash flow range of $395 million to $595 million. The company’s financial position is further strengthened by approximately $1.2 billion of liquidity, with over $470 million of cash on the balance sheet and a net leverage ratio of 3.3x for 2024.

Talen Energy Corporation (NASDAQ:TLN) continues to execute on its AWS contract signed in March 2024, with the site currently being electrified and generating revenues. The company secured a reliability-must-run agreement that extends the life of Brandon Shores and Wagner plants through May 2029, providing annual payments of $145 million for Brandon Shores and $35 million for Wagner, plus reimbursement for variable costs and project investments. Since the start of 2024, the company has demonstrated its commitment to shareholder returns by repurchasing approximately 13 million shares, or 22% of outstanding shares, returning nearly $2 billion of capital to shareholders, representing 75% of the market cap since its emergence.