In this article, we are going to discuss the 12 best utility stocks to buy for dividends.

The ongoing AI boom has taken the American appetite for energy to unprecedented levels, with the Energy Information Administration projecting the country’s power demand to grow to 4,191 billion kilowatt-hours this year and 4,305 billion kWh in 2026, up from a record 4,097 billion kWh in 2024.

So it comes as no surprise that the utility sector has outperformed the broader market and posted gains of over 18% so far since the beginning of 2025, after rallying more than 19% last year. As a result, the companies that supply Americans with their much-needed electricity have gained nearly $500 billion in value over this two-year period.

Moreover, with new data centers getting announced pretty much every week, the utility sector is working hard to make sure that it has enough capacity available to keep up with the ballooning demand and is expected to spend $1.1 trillion in capital investments through 2029, according to the Edison Electric Institute. The increased demand, coupled with an uptick in prices, will in turn also allow the industry to continue growing its cash distributions and keep its shareholders happy.

With that said, here are the Best Utility Dividend Stocks to Invest in.

Our Methodology

To collect data for this article, we referred to several stock screeners to identify utility stocks with the most hedge fund investors in the Insider Monkey database as of the end of Q2 2025. Then we shortlisted the companies that have an annual dividend yield of at least 3% as of 22 October 2025. The following are the Best Utility Dividend Stocks According to Hedge Funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).

12. Brookfield Renewable Corporation (NYSE:BEPC)

No. of Hedge Fund Investors: 22

Dividend Yield as of Oct. 22: 3.81%

Brookfield Renewable Corporation (NYSE:BEPC) operates one of the world’s largest publicly traded platforms for renewable power and decarbonization solutions. The company’s diversified portfolio consists of hydroelectric, wind, solar, distributed energy, and sustainable solutions across five continents.

Brookfield Renewable Corporation (NYSE:BEPC) garnered increased investor attention on October 15 when JPMorgan raised the stock’s price target from $41 to $44, while keeping an ‘Overweight’ rating on its shares. The update comes as the analyst increased targets in the clean energy sector ahead of the coming Q3 reports and noted that the utility-scale operators remain best positioned, while residential players are likely more mixed.

Brookfield Renewable Corporation (NYSE:BEPC)’s long-term, fixed-rate power purchase agreements (PPAs) provide it with the stable cash flows to cover its impressive 3.69% annual dividend yield. The utility is forecasting more than 10% annual FFO per share growth through 2030, with a target to raise its cash distributions by 5% to 9% annually.

11. Dominion Energy, Inc. (NYSE:D)

No. of Hedge Fund Investors: 29

Dividend Yield as of Oct. 22: 4.38%

Dominion Energy, Inc. (NYSE:D) provides regulated electricity service to 3.6 million homes and businesses in Virginia, North Carolina, and South Carolina, and regulated natural gas service to 500,000 customers in South Carolina.

Dominion Energy, Inc. (NYSE:D) enjoys a unique position in Virginia’s ‘Data Center Alley’, serving the largest cluster of power-hungry data centers in the world.  As of late last year, the company had approximately 40 GW of data center capacity contracted, with plans to double that in the coming years. Dominion plans to invest over $50 billion through 2029 to support this expanding power demand, allowing it to grow its EPS by 5% to 7% annually.

Dominion Energy, Inc. (NYSE:D)’s Coastal Virginia Offshore Wind project – a 2.6 GW project that will supply clean energy to 660,000 customers – also remains on track. The offshore wind farm is only a few months away from first power delivery to customers in early 2026, and is still on schedule for full completion at the end of next year.

Earlier this month, Barclays analyst Nicholas Campanella raised the firm’s price target on Dominion Energy, Inc. (NYSE:D) from $60 to $63, while keeping an ‘Overweight’ rating on its shares. With the Q3 report coming up, the analyst has highlighted the utility’s fundamentals as intact.

With an annual dividend yield of 4.34%, Dominion Energy, Inc. (NYSE:D) was also recently included on our list of the 12 Best Nuclear Power Dividend Stocks to Buy Now.

10. OGE Energy Corp. (NYSE:OGE)

No. of Hedge Fund Investors: 32

Dividend Yield as of Oct. 22: 3.66%

OGE Energy Corp. (NYSE:OGE), through its subsidiary, operates as an energy services provider in the United States. With about 7,116 megawatts of capacity, the company generates, transmits, distributes, and sells electric energy.

OGE Energy Corp. (NYSE:OGE) received a lift on October 22 after Jefferies raised the stock’s price target from $52 to $55, while keeping a ‘Buy’ rating on its shares. The analyst expects a mostly positive “super cycle” of updates in the third quarter, with messages of “capex up & cost of capital down” from the utilities sector.

OGE Energy Corp. (NYSE:OGE) remains focused on expansion, with the aim of adding approximately 550 MW of capacity to meet the growing customer demand. This includes the new natural gas combustion turbines at Tinker as well as at Horseshoe Lake Units 11 and 12. These units are expected to be operational within the next year.

OGE Energy Corp. (NYSE:OGE) declared a quarterly dividend of $0.425 per share last month and boasts an annual dividend yield of 3.66% as of the writing of this piece.

9. Clearway Energy, Inc. (NYSE:CWEN)

No. of Hedge Fund Investors: 33

Dividend Yield as of Oct. 22: 5.75%

With a portfolio that comprises approximately 11.8 GW of gross generating capacity in 26 states, Clearway Energy, Inc. (NYSE:CWEN) is one of the largest owners of clean energy generation assets in the United States.

On October 21, CIBC analyst Mark Jarvi raised the firm’s price target on Clearway Energy, Inc. (NYSE:CWEN)  from $35 to $37, while maintaining a ‘Neutral’ rating on its shares. The analyst expects ‘Regulated Utilities’ to meet or exceed estimates in the upcoming Q3 reports, given the generally solid loads and updated rates. Moreover, while the analyst anticipates generally softer results for power companies due to their less favorable generation trends and muted realized pricing trends, he still likes them more from an investment landscape, given some better momentum and more growth and valuation upside.

Clearway Energy, Inc. (NYSE:CWEN) primarily sells electricity under long-term power purchase agreements (PPAs), allowing it to generate stable cash flows and reliably pay dividends to shareholders. The company has an attractive dividend yield of 5.75% as of the writing of this piece, with an aim to increase this by 5% to 8% in the coming years.

8. Evergy, Inc. (NASDAQ:EVRG) 

No. of Hedge Fund Investors: 34

Dividend Yield as of Oct. 22: 3.39%

Next on our list of the Best Utility Dividend Stocks is Evergy, Inc. (NASDAQ:EVRG), which delivers electricity to approximately 1.8 million residential and commercial customers to homes and businesses in Kansas and Missouri.

Evergy, Inc. (NASDAQ:EVRG) received a boost earlier this month when Barclays raised the stock’s price target from $73 to $80, while keeping an ‘Outperform’ rating on its shares. The analyst expects the utility to deliver a ‘quieter’ report for the third quarter, with potential updates on load growth. However, a refreshed business plan is expected in the fourth quarter, with an upward bias for consensus estimates.

Evergy, Inc. (NASDAQ:EVRG) is also making its way in the rapidly evolving nuclear energy sector to make sure it has enough capacity available to serve its customers. Last month, the company signed an MoU to explore sites for a nuclear power project and energy storage system within its service territory using TerraPower’s Natrium nuclear technology.

The share price of Evergy, Inc. (NASDAQ:EVRG) has gained by over 27% since the beginning of 2025, with the stock trading at its all-time high as of the writing of this piece.

7. Public Service Enterprise Group Incorporated (NYSE:PEG)

No. of Hedge Fund Investors: 39

Dividend Yield as of Oct. 22: 3.01%

Public Service Enterprise Group Incorporated (NYSE:PEG) is a predominantly regulated energy company that engages in the provision of electric and gas services.

On October 22, Morgan Stanley raised its price target on Public Service Enterprise Group Incorporated (NYSE:PEG) from $103 to $109, and maintained an ‘Overweight’ rating on its shares. The revision is a part of the firm updating its price targets for Regulated & Diversified Utilities / IPPs in North America under its coverage. The analyst noted that utilities outperformed the S&P in September and expects a key focus for the sector to be on the evolution of data center pipelines as we head into the third-quarter reports.

Public Service Enterprise Group Incorporated (NYSE:PEG) is currently working on its 5-year $22.5 billion – $26 billion capital spending plan, with an aim to grow its adjusted operating earnings at a CAGR of 5% to 7% through 2029 at the nuclear PTC threshold.

Moreover, Public Service Enterprise Group Incorporated (NYSE:PEG) remains strongly committed to its shareholders, having paid dividends for 118 consecutive years. The utility increased its quarterly dividend by 5% to $0.63 per share in July, marking its 14th annual increase in a row.

6. Exelon Corporation (NASDAQ:EXC) 

No. of Hedge Fund Investors: 39

Dividend Yield as of Oct. 22: 3.32%

A Fortune 200 company, Exelon Corporation (NASDAQ:EXC) is one of the country’s largest utility companies, serving more than 10.7 million customers through six fully regulated transmission and distribution utilities.

On October 22, Morgan Stanley raised Exelon Corporation (NASDAQ:EXC)’s price target from $49 to $53, while maintaining an ‘Equal Weight’ rating on its shares. The update comes as the analyst firm revises its price targets for Regulated & Diversified Utilities / IPPs in North America under its coverage. The analyst highlighted that the utilities sector outperformed the S&P last month. Moreover, with the upcoming Q3 reports, the firm expects the sector to focus on the evolution of data center pipelines and is looking for commentary around interconnection time.

Exelon Corporation (NASDAQ:EXC) remains focused on expansion, and the company is investing $38 billion through 2028, with an additional $10 billion to $15 billion on transmission work. Exelon is targeting to grow its earnings at a rate of 5% to 7% annually, with the expectation of delivering at the midpoint or better of that range.

Exelon Corporation (NASDAQ:EXC) declared a quarterly dividend of $0.40 per share in July and currently boasts an annual dividend yield of 3.32%.

5. FirstEnergy Corp. (NYSE:FE) 

No. of Hedge Fund Investors: 39

Dividend Yield as of Oct. 22: 3.76%

FirstEnergy Corp. (NYSE:FE)’s 10 electric distribution companies form one of America’s largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland, and New York.

On October 22, FirstEnergy Corp. (NYSE:FE) reported its Q3 results, with the company’s adjusted EPS growing by 9% YoY to $0.83, and beating expectations by $0.06. This growth was driven by the impact of new base rates in Pennsylvania and the increase in transmission rate base under formula rate programs. Moreover, based on its strong YTD performance, the utility narrowed its 2025 full-year core earnings guidance range to $2.50 to $2.56 per share, in the upper half of the original range.

FirstEnergy Corp. (NYSE:FE) is aiming to grow its core earnings at a CAGR of 6-8% from 2025 through 2029, driven by the company’s Energize365 capital investment plan that includes $28 billion in investments from 2025 to 2029. FE deployed over $4 billion in capital investments through the first nine months of 2025 to support grid reliability and resiliency, and even announced an increase in its planned investments from $5 billion to $5.5 billion this year.

FirstEnergy Corp. (NYSE:FE) declared a quarterly dividend of $0.445 per share in September and has an impressive annual dividend yield of 3.76% as of the writing of this piece.

4. Eversource Energy (NYSE:ES)

No. of Hedge Fund Investors: 40

Dividend Yield as of Oct. 22: 4.12%

Next on our list of the Best Dividend Stocks in the utilities sector is Eversource Energy (NYSE:ES), which operates New England’s largest energy delivery system and serves customers in Connecticut, Massachusetts, and New Hampshire.

On October 22, Jefferies analyst Paul Zimbardo raised the price target for Eversource Energy (NYSE:ES) from $54 to $60 and maintained an ‘Underperform’ rating on its shares. While the analyst continues to see complexity in the Aquarion divestiture approval process, it expects the deal to close this year with the belief that it will ‘eventually be approved in some form, but the draft could call for denial without prejudice’. Moreover, the analyst noted that while the short-term tax credits should help support the company’s Q3 results and FY25 EPS, they are ‘not sustainable’.

Eversource Energy (NYSE:ES) operates in a regulated sector, providing it with stable cash flows and relatively consistent earnings, enabling the company to raise its payouts even during periods of economic difficulty. ES has grown its dividends for 25 consecutive years, putting it in our list of the Top 15 Dividend Growth Stocks for Long-Term Investors.

3. The Southern Company (NYSE:SO)

No. of Hedge Fund Holders: 48

Dividend Yield as of Oct. 22: 3.04%

The Southern Company (NYSE:SO) is one of the largest producers of electricity in the United States and the largest wholesale provider in the Southeast. Together with its subsidiaries, the company delivers clean, safe, reliable, and affordable energy to its 9 million customers.

The Southern Company (NYSE:SO) received a lift on October 22 after Morgan Stanley raised the stock’s price target from $92 to $99, while keeping an ‘Equal Weight’ rating on the shares. The revision is a part of the analyst updating its price targets for Regulated & Diversified Utilities / IPPs in North America under its coverage. The analyst firm noted that the utilities sector outperformed the S&P in September. As we head into the third quarter reports, it is expected that a key focus for the sector will be on the evolution of data center pipelines, with the analyst keeping an eye out for commentary around interconnection times.

The Southern Company (NYSE:SO) maintains an impeccable record of cash distributions, and every quarter for the last 78 years, the company has announced a dividend for its shareholders that is equal to or greater than the previous quarter. On October 20, SO announced a quarterly dividend of $0.74 per share.

2. The AES Corporation (NYSE:AES)

No. of Hedge Fund Holders: 49

Dividend Yield as of Oct. 22: 4.93%

The AES Corporation (NYSE:AES), together with its subsidiaries, operates as a power generation and utility company in the United States and internationally. Ranked as the largest global supplier of clean energy to corporations by BloombergNEF for the third consecutive year, the company maintains a substantial project pipeline across solar, wind, and energy storage.

On October 21, Barclays raised its price target on The AES Corporation (NYSE:AES) from $14 to $15, and kept an ‘Overweight’ rating on its shares. The update comes as part of a Q3 earnings preview for the power and utilities sector, with the analyst remaining bullish on the group due to earnings outlooks.

The AES Corporation (NYSE:AES) announced in August that it would return approximately $500 million this year with its annual dividend of $0.7 per share, while investing around $1.8 billion towards expansion, primarily in the renewables and utilities businesses. Staying true to its commitment, the company declared a quarterly dividend of $0.17595 per share earlier this month. AES boasts an impressive annual dividend yield of 4.93% as of the writing of this piece.

1. Duke Energy Corporation (NYSE:DUK)

No. of Hedge Fund Holders: 77

Dividend Yield as of Oct. 22: 3.3%

Topping our list of the Best Utility Dividend Stocks is Duke Energy Corporation (NYSE:DUK), which engages in the distribution of natural gas and energy-related services.

Duke Energy Corporation (NYSE:DUK) received a boost on October 22 when Morgan Stanley analyst David Arcaro raised the stock’s price target from $127 to $136, while maintaining an ‘Equal Weight’ rating on its shares. The update is a part of the firm revising its price targets for Regulated & Diversified Utilities / IPPs in North America under its coverage. The firm highlighted that the utilities sector outperformed the S&P last month. The analyst expects a key focus for the sector to be on the evolution of data center pipelines in the upcoming Q3 reports and will be looking for comments around interconnection times.

Backed by government-regulated rate structures, Duke Energy Corporation (NYSE:DUK)’s stable cash flows have allowed it to pay dividends for 99 consecutive years as of late 2025. Moreover, Duke currently has a massive $83 billion investment program underway to expand its transmission and distribution network, enabling it to grow its EPS at a rate of 5% to 7% through 2029. The growth in earnings should allow the utility to continue increasing its shareholder distributions.

While we acknowledge the potential of DUK to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than DUK and that has 100x upside potential, check out our report about this cheapest AI stock.

READ NEXT: 12 Best Nuclear Power Dividend Stocks to Buy Now and 12 Best LNG Stocks to Buy According to Hedge Funds.

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