A sector of the stock market beloved by income investors could ride the wave of rising energy consumption over the long run, according to Wells Fargo. Artificial intelligence, manufacturing and electrification will drive demand for electricity in the U.S. in the approaching years, according to a team of the firm's analysts led by Neil Kalton. After 15 years of relatively flat power demand, Wells Fargo sees a compound annual growth rate of 2.6% through 2030 and 80% growth by 2050.
Back in January, Duke updated its resource plan to include the potential for wind generation off the coast of North Carolina, subject to regulatory approvals. Shares are up 6.6% in 2024, and the stock has a dividend yield of 4%. Renewable energy play NextEra also caught Wells' attention, as analysts said it's "well-positioned to capitalize on the growing demand" for core products, including wind, solar and battery storage. The stock is up 27% in 2024, and it yields 2.7%.
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