Yahoo Finance | 3 Utility Stocks With Strong Dividends and Room to Run Higher

As the Iran war rages on, investors are seeking safe havens away from market volatility. One popular sector is the utility industry, which is full of low-beta stocks that pay healthy dividends.

Utilities are large and highly regulated, which caps upside potential but offers predictability and stability during volatile periods. That’s why we’ve sought out utilities that offer a little bit of both: income from dividends and potential capital appreciation, not just preservation. The three stocks selected here have strong dividends, consistent earnings growth, and low volatility, which is exactly what everyday investors need to weather a geopolitical shock.

NextEra Energy Inc. (NYSE: NEE) combines a stable, income-generating industry with a fast-growing and potentially profitable one. NextEra operates Florida Power and Light, the largest regulated utility in the country, and NextEra Energy Resources, which owns the largest portfolio of wind and solar energy assets on the planet. Florida Power and Light serves more than 5 million customers, providing the company with a steady, state-regulated income stream to complement its renewable energy revenues. NextEra earned more than $27 billion in revenue in the last 12 months. Renewable energy has been a volatile industry to invest in, and NextEra shares have the highest beta of any stock on this list at 0.75. But 0.75 is still 25% less volatile than the S&P 500, and the company’s dividend strength makes it worth the ups and downs. NextEra pays a 2.7% yield with a 75% dividend payout ratio (DPR), which is high but not alarming for a regulated utility. The company has also raised dividend payouts for 31 consecutive years, with 10% annualized growth over the last five years.

Read more: https://finance.yahoo.com/markets/stocks/articles/3-utility-stocks-strong-dividends-132400977.html

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