Electricity demand is surging, presenting a significant opportunity for utilities like Dominion Energy (D) and NextEra Energy (NEE). Dominion stands out with a robust 4.2% dividend yield, significantly higher than NextEra’s 2.7% and the average utility yield of 2.6%. However, Dominion’s track record of missing its own growth targets raises concerns among investors, especially after its recent divestitures that have left it solely as a regulated electric utility.
In contrast, NextEra Energy has consistently met its growth promises, with a solid foundation in regulated utilities and a strong renewable energy segment. Although the company plans to slow its dividend growth from 10% to 6% in the coming years, this rate still outpaces historical inflation, making it an attractive option for dividend-focused investors.
Ultimately, while Dominion offers a higher yield, NextEra’s reliability and proven execution may make it the safer choice for those prioritizing consistent dividend income amidst rising electricity demand.
Source: fool.com