Entergy

ETR

Market cap $53.3B

Skyrocketing demand from artificial intelligence data centers is exacerbating shortages of critical grid equipment like transformers across the U.S., driving up costs, stretching out wait times and spurring utilities ​and developers to lock in orders far in advance.

Long-term bond yields persist despite pressure. But investors looking for income can still find plenty of attractive opportunities with dividend-paying stocks that have healthy yields. “23 stocks pay huge dividends. They should be a better bet than treasuries.” —Barron's Weekly reported in October, 2024. It's still true. Steven Wieting, strategist at CitiWealth, told Barron's that a growing dividend is a benefit for shareholders and identifies companies with strong balance sheets.“Nobody can fake a dividend,” he said.

The PGIM Jennison Utility Fund advanced though underperformed the 8.3% return of the S&P 500 Utilities Index for the first quarter. Key contributors were NextEra Energy, Entergy Corporation and CenterPoint Energy. Key detractors Constellation Energy, Talen Energy Corporation and Vistra Corp.

Artificial-intelligence stocks are on the rise again, but they come with high volatility. Where to find AI-related stocks that are more stable.

ETR and XEL are compared on earnings growth, ROE, dividends, capital spending and share performance as utility demand continues to rise.

I am rating Entergy Corporation as a buy with a $148 price target, implying a 34.5% upside from the current price of $110. The biggest growth drivers are the Meta-linked Louisiana data center investment, broader industrial load growth, new generation, transmission expansion, renewables, storage, and distribution capex. I estimate these growth drivers can take adjusted EPS from $3.91 in 2025 to about $7.40 by 2030. This is close to management's 2029 guidance of $7.05 to $7.35.

Entergy Corporation (ETR) Analyst/Investor Day Transcript

Entergy Chair and CEO Drew Marsh joins 'Mad Money' host Jim Cramer to talk data center energy demand, its recently unveiled capital plan, and more.

Entergy CEO Drew Marsh said data centers can be a win for local communities rather than a burden on residents. Marsh said Entergy's "Fair Share Plus" framework could generate roughly $7 billion in savings for existing customers by requiring data center operators to cover infrastructure and other costs.

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