7 Cheap Utility Stocks to Buy According to Hedge Funds

3. Duke Energy Corporation (NYSE:DUK)

Forward P/E as of September 27: 18.17

Earnings Growth this year: 7.60%

Number of Hedge Fund Holders: 37

Duke Energy Corporation (NYSE:DUK) is a U.S.-based energy company operating through two primary segments: Electric Utilities and Infrastructure (EU&I) and Gas Utilities and Infrastructure (GU&I).

On September 26, BMO Capital maintained its Outperform rating for DUK with an unchanged price target of $126. The firm revised its third-quarter earnings estimate for the company to $1.68 per share, down from $1.94 in the same quarter last year. The year-over-year decline of $0.25 per share was primarily due to the timing of reversals related to agility initiatives, favorable weather conditions in Q3 2023, and costs associated with Hurricane Debby.

Looking ahead, BMO Capital raised its fourth-quarter 2024 earnings estimate for Duke Energy Corporation (NYSE:DUK) to $1.73 per share, up from $1.51 in Q4 2023. This adjustment reflects anticipated normalized weather conditions, increased contributions from the Gas Utilities and Infrastructure segment, annualized rate relief, and higher interest expenses. The firm also increased its full-year 2024 earnings estimate to $6.03 per share, up from the previous estimate of $5.97.

Additionally, Duke Energy Corporation (NYSE:DUK) managed to secure a $57 million grant from the U.S. Department of Energy to rebuild a critical power line in North Carolina, a project expected to enhance grid reliability and create approximately 550 jobs. The company also issued $1 billion in junior subordinated debentures as part of its capital management strategy.

As of the second quarter of 2024, 37 hedge funds held bullish positions in Duke Energy Corporation (NYSE:DUK), down from 34 in the previous quarter, according to Insider Monkey. Among them, Adage Capital Management, led by Phill Gross and Robert Atchinson, held a significant stake, with 1.06 million shares valued at over $106.7 million.