12 High-Growth Utility Stocks to Buy Now

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10. Atmos Energy Corporation (NYSE:ATO)

Number of Hedge Fund Holders: 31

Average 5-Year Revenue Growth: 9.58%

Atmos Energy Corporation (NYSE:ATO) is one of the best high-growth utility stocks to buy. On October 16, BofA analysts downgraded Atmos to Neutral from Buy, noting that the stock has a high valuation multiple compared to others in the industry. However, the firm updated the price target from $182 to $185.

BofA observed that in comparison to industry peers, ATO is presently trading at a 22% valuation premium. The investment firm commented that the company’s growth potential is already factored into the high valuation multiple.

Although there is a possibility of higher capex requirements to advance data centers in Texas, the firm believes these opportunities will not boost short-term earnings potential much beyond what the market already anticipates.

Moreover, BofA adjusted its EPS forecast for Atmos to $7.41, $7.95, and $8.60 for FY 2025, 2026, and 2027, respectively, which are marginally higher than the prior numbers of $7.30, $7.83, and $8.52 for these years.

The updated numbers indicated an EPS CAGR of nearly 8.4%, which is higher than the company’s guidance of 6% to 8%. It factors in the effect of the Texas House Bill 4384 as well.

Atmos Energy Corporation (NYSE:ATO) is a Texas-based company that operates within the natural gas sector through two business segments: Distribution and Pipeline and Storage. The company serves residential, commercial, public, and industrial customers.

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