In the changing landscape of Canadian utilities, three giants stand tall in this current market. Each utility stock offers a unique blend of stability, growth, and commitment to renewable energy, making them compelling choices for investors in 2025.
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Fortis
Fortis (TSX:FTS), a stalwart in the utility sector, consistently demonstrated robust financial health. In its recent earnings report, Fortis highlighted a 2.2% year-over-year increase in quarterly revenue, reaching $11.51 billion for the 12 months ending Dec. 31, 2024. This growth shows the utility stock’s strength and ability to adapt in a dynamic market.
Notably, Fortis has a strong track record of rewarding its shareholders. The utility stock has increased its dividends for 51 consecutive years, reflecting its commitment to delivering consistent returns. Currently, Fortis offers a forward dividend yield of approximately 3.84%, with an annual dividend of $2.46 per share, making it an attractive option for income-focused investors.
Hydro One
Hydro One (TSX:H), Ontario’s primary electricity transmission and distribution service provider, continues to showcase solid performance. The utility stock’s recent financials reveal a 5.9% year-over-year growth in quarterly revenue, totalling $8.48 billion over the past year. This steady growth highlights Hydro One’s pivotal role in the province’s energy infrastructure.
Investors seeking reliable income streams will find Hydro One appealing. With an annualized dividend of $1.26 per share, the utility stock offers a yield of around 2.8%. This consistent payout reflects Hydro One’s stable cash flows and its dedication to returning value to shareholders.
Brookfield Renewable
Brookfield Renewable Partners (TSX:BEP.UN) stands at the forefront of the renewable energy sector. The utility stock reported record funds from operations (FFO) of $1.217 billion, or $1.83 per unit, for the 12 months ending Dec. 31, 2024, a 10% increase on a per-unit basis compared to the previous year. This achievement shows Brookfield’s strategic investments and operational excellence in renewable energy.
In recognition of its strong performance, Brookfield announced a 5% increase in its annual distribution, raising it to $1.492 per unit. This marks the 14th consecutive year of distribution growth, reflecting the company’s robust financial health and commitment to delivering value to its investors.
Future focus
Looking ahead, Fortis outlined a $26 billion capital plan extending through 2029, aiming for a 6.5% annual rate base growth. This ambitious plan focuses on enhancing its regulated utility assets, ensuring long-term stability and growth potential.
Hydro One’s strategic position as a near-monopoly in Ontario’s electricity transmission and distribution sector provides it with a stable revenue base. The utility stock’s ongoing investments in infrastructure modernization are expected to support its growth trajectory and operational efficiency.
Brookfield Renewable’s expansive portfolio, encompassing hydro, wind, solar, and battery storage assets, positions it well to capitalize on the global shift toward clean energy. The utility stock’s proactive approach to asset recycling and strategic acquisitions is expected to drive sustained growth in the renewable sector.
Bottom line
These utility stocks each present unique value propositions for investors. Fortis offers a blend of stability and growth through its extensive capital plan and consistent dividend increases. Hydro One provides reliable income backed by its dominant position in Ontario’s electricity market. Brookfield Renewable stands out with its strong commitment to renewable energy and impressive financial performance. Together, these companies exemplify the strength and diversity of Canada’s utilities sector in 2025.
