iShares Global Utilities ETF

JXI

Market cap $234M

I rate iShares Global Utilities ETF a buy, as utilities offer both defensive stability and growth from decarbonization and rising global energy demand. JXI stands out for its global diversification and lower company-specific risk compared to U.S.-focused peers like XLU and FUTY. Despite a higher expense ratio, JXI trades at lower valuation multiples and has outperformed peers over the last three years.

For investors seeking momentum, iShares Global Utilities ETF JXI is probably on the radar. The fund just hit a 52-week high and is up 22.04% from its 52-week low price of $59.63/share.

JXI, the iShares Global Utilities ETF, underperforms peer ETFs and charges higher fees, making it less attractive for utility stock exposure. JXI's expense ratio is 0.41%, higher than competitors like FUTY and XLU, which offer better returns and liquidity. JXI's dividend yield is 2.88%, lower than its peers' 3%, further diminishing its appeal for income-focused investors.

This article series reports subsector metrics in utilities, aiding top-down analysis and stock picking. Water utilities are undervalued by 12% based on 11-year averages, while electricity/multi-utilities are overvalued by 15%. JXI ETF offers global utilities exposure, but fees and underperformance make it uncompelling compared to a domestic benchmark.

The utilities sector is moderately overvalued compared to 11-year averages, with gas utilities near baseline and other subsectors overvalued by 8%-12%. iShares Global Utilities ETF offers global utilities exposure and is more diversified than XLU, but with 66% U.S. assets and a significant concentration in top holdings. 10 utilities stocks cheaper than their peers in September.

The utilities sector (XLU) has remained nearly flat year-to-date when compared to the massive gains seen in other sectors in 2024, such as technology. Citi Equity Analyst Ryan Levine believes that the utilities sector's poor performance has gone on for too long, pointing to AI as "the real emerging story" that will "create a demand growth for the industry at large.

With the Fed and ECB set to lower rates later in 2024, big dividend-paying utilities could thrive.