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Looking for Answers in Utilities' Earnings

Usually bland first-quarter earnings reports should offer many insights for 2020 and beyond.

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Utilities’ first-quarter earnings rarely offer much excitement. This year will be different; we expect lively coronavirus commentary from utilities. In this article, we discuss the key COVID-19 issues that could have short- and long-term implications for investors.

We also include two lists of utilities to watch this earnings season: One group we consider value and one group we consider high quality. Atypical volatility among utilities stocks during the past month has created a wide spread between the overloved and the underloved. The value stocks could get an outsize lift if management commentary pushes the market toward our more positive outlook. We expect the most consistency from the quality stocks; if the market were to turn down, as it did in mid-March, investors should be ready to pounce.

Travis Miller does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

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