If you don’t want to take unnecessary risks in the stock market and still want to grow your wealth steadily, Canadian utility stocks deserve a spot on your portfolio. These companies are often seen as boring, but for good reason, as they offer stability, predictable cash flow, and reliable dividends. In fact, some utility stocks go beyond defensive value and deliver impressive total returns through a combination of income and capital appreciation. In today’s uncertain macroeconomic environment, that blend of safety and upside is hard to ignore.
In this article, I’ll talk about one Canadian utility stock that could deliver big total returns in the years ahead, along with stable dividends.
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A top Canadian utility stock to buy now
Among the most promising stocks in the utility sector right now is Emera (TSX: EMA), which has been steadily building momentum with a smart mix of stability and growth. Headquartered in Halifax, it operates a diverse portfolio of regulated electric and gas utilities across Canada, the U.S., and the Caribbean. EMA stock currently trades at $58.78 per share with a market cap of $17.5 billion. Its investors also benefit from a quarterly dividend that yields nearly 4.9% annually.
While utility stocks aren’t known for explosive growth, Emera has been on a consistent climb of late. Its share price is up nearly 25% in the past year, including a 29% jump over the last nine months. With this, EMA stock is now trading just under its 52-week high, reflecting renewed investor confidence in the company.
What’s powering the stock’s momentum?
A big part of Emera’s recent momentum comes down to its consistent focus on strong execution. Recently, the company completed a major regulatory milestone with Tampa Electric’s rate case, which is expected to boost its revenues significantly over the next few years. To give a quick idea, it’s expected to increase Emera’s revenue by US$185 million in 2025 alone. That’s a major win for its Florida operations, where customer growth is robust.
Last year, Emera also executed its largest-ever capital investment plan, spending around $3.2 billion to modernize its infrastructure and improve grid reliability. While its 2024 financials took a one-time hit from the sale of its stake in the Labrador Island Link, its underlying operations remained strong. As a result, the company’s adjusted earnings per share jumped 33% YoY (year over year) in the fourth quarter of 2024 to $0.84 per share due to better performance across all its regulated utility segments.
Its long-term growth plan adds to the upside
Despite being from the utility sector, Emera isn’t just playing defence, as it has a clear path for long-term growth. The company has lined up a $20 billion capital plan over the next five years, with a sharp focus on clean energy, grid modernization, and infrastructure expansion. These investments are expected to fuel 7% to 8% annual rate base growth, which should gradually improve its earnings and cash flow growth.
Overall, dependable income today and meaningful upside for tomorrow is exactly the kind of mix most investors want right now. With a growing footprint in the high-demand Florida market, disciplined cost management, and a cleaner energy future in focus, Emera stock has the potential to deliver solid total returns in the years ahead.
