As the US electric demand continues to rise, driven by factors such as the development of data centers, crypto mining centers, and the electrification of buildings and transportation, investors are eyeing potential opportunities in the utility sector. Bank of America has identified five national utility stocks that could see upside as a result of this growing demand.
According to analysts at BofA, the US could require as much as 100 gigawatts of effective capacity by 2035, with a potential high-case scenario requiring up to 300 gigawatts instead. This trend is being fueled by various factors, including the growth of artificial intelligence, which alone could require significant capacity by 2026.
Among the utility firms that stand to benefit from this trend are Sempra, Northwestern Energy, Pinnacle West, Entergy, and TXNM. Each of these companies could potentially see significant gains based on BofA’s analysis.
Entergy, for example, is projected to rise 3.6% from current levels, with a price target of $138 per share. The company has already been involved in supporting the development of AI data centers and expanding the power-charging grid for electric vehicles.
Sempra, on the other hand, is expected to rise 13% based on the bank’s $94 share target. Northwestern Energy could also see a jump of over 13% to reach a $65 price target. Pinnacle West and TXNM Energy are also projected to see gains based on BofA’s price targets.
With the increasing demand for electricity in the US and the potential for significant growth in the utility sector, investors may want to consider these five national utility stocks as potential investment opportunities. Stay ahead of the curve and explore how these companies could benefit from the evolving landscape of electric demand in the US.