Xcel Energy (XEL) Price Target Boosted at Morgan Stanley. Here is Why

With an annual dividend yield of 2.90%, Xcel Energy Inc. (NASDAQ:XEL) is included among the 12 Best NASDAQ Stocks to Buy for Dividends.

Xcel Energy (XEL) Price Target Boosted at Morgan Stanley. Here is Why

Xcel Energy Inc. (NASDAQ:XEL) is a major US electricity and natural gas company with operations in 8 Western and Midwestern states.

On June 24, Morgan Stanley upped its price target on Xcel Energy Inc. (NASDAQ:XEL) from $87 to $89, while reaffirming an ‘Equal Weight’ rating on the shares. The target boost indicates an upside potential of almost 9% from the current share price.

The move comes after Morgan Stanley revised its price objectives for Regulated & Diversified Utilities / IPPs in North America for the month of May. The analyst firm noted that the utilities sector fell by 5.5% last month, significantly underperforming the gains of around 5.1% posted by the overall S&P during the period.

Xcel Energy Inc. (NASDAQ:XEL) has grown its dividends for 23 consecutive years, and intends to carry on this momentum by targeting annual dividend increases of 4-6% and a payout ratio of 45-55%. The stock currently boasts a robust annual dividend yield of 2.90%.

The Mairs & Power, an investment firm, stated the following regarding Xcel Energy Inc. (NASDAQ:XEL) in its Q1 2026 investor letter:

“Our build-up in exposure to Utilities in the last year aided relative performance in the quarter as the generally defensive sector overweight helped in a market that proved relatively choppy. The Fund owns Xcel Energy (NASDAQ:XEL) which we believe should benefit from stable and visible earnings growth from attractive service areas with favorable regulatory oversight.”

While we acknowledge the risk and potential of XEL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than XEL and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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