2 Canadian Utility Stocks Poised to Win Big in 2026

Monthly utility stocks can win big in 2026. Investors crave two things when the economy feels uncertain: predictable cash flow and dividends that keep showing up. Utilities often deliver both because regulators set the rules, customers keep paying their bills, and companies earn returns on long-lived infrastructure.

If interest rates ease at all, utilities can also get a valuation boost, since income investors stop obsessing over bond yields and start paying up for stability again. Add in rising power demand from electrification and data centres, and you get a backdrop where steady names can surprise to the upside. So, let’s look at two to consider.

CPX

Capital Power (TSX:CPX) sits in a sweet spot, blending utility-like cash generation with a growth pipeline. It owns power generation assets across Canada and the United States, and it has been shifting toward a more flexible, modern fleet while still prioritizing contracted and hedged cash flows. It completed major work at Genesee, and it expanded in the U.S. through acquisitions while continuing to advance new development projects.

Then there’s earnings. For full-year 2024, CPX generated $3.78 billion in revenue and other income, produced adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.33 billion, and delivered adjusted funds from operations (AFFO) of $817 million. Net income came in at $701 million, and AFFO per share landed at $6.34. It also declared $2.534 in dividends per common share in 2024, which gives you a clear view of coverage when you compare the dividend to AFFO.

Looking forward, CPX’s upside in 2026 hinges on two levers: bringing projects online on time and keeping contracting strong. If power markets tighten, it can get extra tailwind, but it does not need a perfect environment if contracted cash flows stay steady. The risk is execution and cost control, as project delays and higher financing costs can hit sentiment quickly even when the long-term demand picture stays strong.

CU

Canadian Utilities (TSX:CU) offers the steadier, pension-like side of this theme. It runs regulated utility and energy infrastructure assets, with earnings that tend to move with approved rates and rate base growth rather than commodity swings. Over the last year, CU’s narrative has stayed focused on regulated growth and dependable dividends. It kept pushing capital into infrastructure that regulators tend to support, and it continued to emphasize operational execution.

In 2024, it reported revenue of $3.74 billion and adjusted earnings of $647 million, or $2.38 per share, up from $596 million, or $2.21 per share, in 2023. More recently, in the third quarter of 2025, it reported adjusted earnings of $108 million, or $0.40 per share, up from $102 million, or $0.38 per share, in Q3 2024, reinforcing the point that it can keep grinding out steady results even without a booming economy. On the dividend side, it declared a first-quarter 2026 dividend of $1.85 annually, continuing its long history of annual dividend increases.

Looking ahead, CU’s 2026 setup depends on the same things that always drive regulated utilities: rate base investment, regulatory outcomes, and financing discipline. If rates ease, the market can re-rate the stock even if earnings growth stays modest, simply because the dividend looks more attractive again. The risk is that unfavourable regulatory decisions, higher-than-expected capital costs, or a rate environment that stays tight longer than investors expect.

Bottom line

If Canadian utility stocks win big in 2026, it will likely look boring in real time and obvious in hindsight. But both offer you a very not boring dividend. Even $7,000 in each can bring in substantial income.

Put them together and you get a simple message for 2026: steady cash flows plus even modest valuation relief can add up to a surprisingly strong year.