8 Most Profitable Utility Stocks To Invest In

4. AES (NYSE:AES)  

Number of Hedge Fund Holders: 46  

TTM Net Income: $754 Million  

5-Year Net Income CAGR: 13.52%

AES (NYSE:AES) is a utility company focused on providing affordable and sustainable energy solutions. The company operates in 15 countries and owns renewable energy assets, such as solar and wind in addition to conventional energy sources. AES (NYSE:AES) is committed to achieving net zero carbon emissions by 2050 and has made significant progress in expanding its clean energy portfolio.

AES’s (NYSE:AES) business model is well-positioned to benefit from the increasing global demand for clean energy. The company is rapidly growing its renewable portfolio, with a target of reaching 30GW of capacity by 2027, a key factor in its contracts with major corporate clients such as Microsoft and Google. AES’s (NYSE:AES) diverse revenue streams, including electricity generation, utility services, and energy infrastructure, provide stability during cyclical market fluctuations. The company’s aggressive transition to renewables is expected to fuel long-term growth, with its growing project backlog showcasing its ability to execute its strategy.

Despite being a major utility player, AES (NYSE:AES) is trading at 9.06 times this year’s earnings estimate, representing a 48.02% discount to its sector median of 17.44. The company’s 3.55% dividend yield is attractive, and its investment-grade credit rating remains stable. Analysts predict AES’s (NYSE:AES) earnings will grow by 8.69% this year and are optimistic about its stock, with a consensus Buy rating and a target price of $22.59, indicating a potential 26.35% increase from its current level.