Utilities Sector

• Constellation Energy Corporation’s third quarter financial performance reflects strong operational execution across its nuclear and energy generation assets.
• The company reported GAAP earnings of $2.97 per share and adjusted operating earnings of $3.04 per share, an increase compared to the same period last year.
• This performance was attributed to fewer nuclear outage days and robust generation volumes, though the financial benefits were partially offset by nonrecurring operating and maintenance (O&M) headwinds due to stock compensation plans triggered by the company’s stock appreciation.

• Aggressive Capacity Expansion Pipeline: Prime Road Power is embarking on a significant growth trajectory, aiming to expand its renewable energy capacity from approximately 307.5 MW to 1,800 MW by 2027. This expansion is geographically diversified across Thailand, Taiwan, Cambodia, and Japan, with plans to enter the Indonesian market. Key projects include a 200-MW solar farm in Taiwan and a joint venture with the Industrial Estate Authority of Thailand (IEAT) to develop solar projects in industrial estates.
• Supportive Regulatory Environment: The company operates in a favorable regulatory landscape, particularly in its home market of Thailand. The government’s Power Development Plan (PDP) aims to increase the share of renewable energy to 51% of total power generation by 2037, creating a significant tailwind for growth. This long-term policy provides visibility and support for new renewable energy projects.
• Challenging Financial Performance: Despite strong revenue growth, the company has experienced significant net losses in recent years, as reflected in the provided financial data for 2023 and 2024. This unprofitability, coupled with negative operating and free cash flows in some periods and a high debt-to-equity ratio, presents a key challenge. The company’s ability to manage its finances and execute its ambitious growth plan profitably will be critical for future success.

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• In today’s Morning Views publication we comment on developments of the following high yield issuers: Adani Energy Solutions, Genting Berhad, Xiaomi Corp
• UST yields rose 1-3 bps yesterday, to the highest levels in two months. The move appeared to be driven by lower expectations of Fed rate cuts next year, even as the market firmly priced in 25 bps of rate reductions this week.
• The yield on the 2Y UST rose 1 bp to 3.58%, while the yield on the 10Y UST climbed 3 bps to 4.17%. Equities halted a four-day rally, with the S&P and Nasdaq down 0.3% and 0.1%, respectively.

• Evergy, Inc., a leading utility company, has reported its third quarter earnings for 2025, revealing a strong consistent performance with an adjusted earnings per share (EPS) of $2.03 compared to $2.02 in the same period last year.
• This increase was achieved largely due to the recovery on regulated investments and growth in weather-normalized demand, although offset by increased interest and depreciation expenses along with dilution from convertible debt.
• Year-to-date adjusted earnings were recorded at $3.41 per share, slightly down from $3.46 from the previous year, influenced by unfavorable weather conditions in the second and third quarters which negatively impacted results by $0.13 per share.

• NRG Energy, Inc.’s third-quarter earnings call for 2025 provided detailed insights into the company’s financial performance and strategic initiatives.
• The company reported strong results, with an impressive 32% increase in adjusted EPS from the same quarter last year and adjusted EBITDA reaching a new quarterly high.
• The quarter’s success can be credited to robust performance in both the Energy and Smart Home segments, thriving on supply optimization, expanded customer base, and enhanced retention rates.

• Alliant Energy Corporation’s recent earnings call for the third quarter of 2025 provided a comprehensive overview of its financial performance, strategic initiatives, and future growth plans.
• The company reported solid financial results, highlighting its ongoing investments in infrastructure to support increased power demand.
• For the third quarter, Alliant Energy achieved ongoing earnings of $1.12 per share, marking consistent performance with over 80% of the midpoint of its 2025 earnings guidance realized.

• Hs outperformed As on average by 0.99% within the liquid AH pair universe over the past two weeks. Beautiful Skew Behaved Badly.
• Quiddity H/A Portfolio performance slightly negative over two weeks, both outright and alpha.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The Southbound Flow Monitor and AH Pairs Monitor are both there – free for all SK readers.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: Greenko Energy, New World Development
• UST yields fell 2-3 bps yesterday, following the release of weaker than expected November ADP payrolls data. The yield on the 2Y and 10Y UST declined 2 bps to 3.49% and 4.06%, respectively. Equities rose, as the labour market slowdown reinforced market expectations for a Fed rate cut this month. The S&P 500 advanced 0.3% to 6,850, while the Nasdaq was up 0.2% at 23,454.
• In the US, the ADP employment report showed that private-sector payrolls declined by 32 k in November (10 k e / 47 k revised p), with payrolls having fallen in four of the past six months. Hiring has been choppy of late, as employers weather cautious consumers and an uncertain macroeconomic environment, according to ADP chief economist Nela Richardson. While the November slowdown was broad-based, it was led by a pullback among small businesses.

• In evaluating FirstEnergy Corp.’s third-quarter 2025 results, several key aspects inform an investment thesis.
• On the positive side, the company reported increases in both GAAP and core earnings per share, underscoring strong operational performance.
• Specifically, FirstEnergy’s core earnings saw a rise to $0.83 per share from $0.76 the previous year, while year-to-date core earnings jumped 15% to $2.02 per share, driven by effective execution of customer-focused investments and base rate adjustments in Pennsylvania.

• American Water reported solid financial results for the second quarter of 2025, highlighting a positive trajectory in earnings and business operations.
• The company’s earnings per share (EPS) for the quarter were $1.48, an increase from $1.42 in the same period last year.
• For the first half of the year, EPS grew to $2.53 compared to $2.37 in 2024.

• UST yields increased yesterday, led by the long end, following Merck & Co’s USD 8 bn eight-part offering and in tandem with a jump in JGB yields following rate-hike comments by Bank of Japan Governor Kazuo Ueda.
• The yield on the 2Y UST rose 4 bps to 3.53%, while the yield on the 10Y UST jumped 7 bps to 4.09%. Equities retreated on risk aversion, amid a sell-off in cryptocurrencies.
• The S&P 500 and Nasdaq declined 0.5% and 0.4% to 6,813 and 23,276, respectively. 

• Brookfield Renewable Partners recently reported its third-quarter 2025 performance, reflecting a complex mix of achievements and challenges.
• The company recorded an increase in funds from operations (FFO) at $302 million or $0.46 per unit, marking a 10% year-over-year growth.
• This performance was primarily driven by strong commercial and operational execution, strategic investments, and contributions from recent mergers and acquisitions across their diversified renewables portfolio.

• The recent earnings call for Ameren Corporation provided an in-depth look at the company’s third-quarter performance and strategic direction.
• Ameren reported adjusted earnings of $2.17 per share for the third quarter of 2025, an increase from $1.87 per share in the same period in 2024.
• This growth was attributed to several factors, including new electric service rates in Missouri and favorable weather conditions.

• Black Hills Corporation reported strong third-quarter 2025 financial results, reaffirming its earnings guidance and highlighting key operational and strategic achievements.
• The company emphasized its commitment to delivering on financial, regulatory, and growth initiatives, while also progressing with a merger with NorthWestern Energy.
• Black Hills is on track to achieve its full-year earnings guidance, driven by new base rates, rider recovery, and customer growth.

• PPL Corporation’s third-quarter 2025 financial results present a complex picture of strengths and challenges for potential investors.
• The company reported GAAP earnings of $0.43 per share, with earnings from ongoing operations adjusted to $0.48 per share.
• This reflects a significant improvement from the $0.29 per share recorded in the third quarter of 2024.

• Southwest Gas Holdings’ recent earnings call provided a comprehensive overview of their financial and strategic positioning for the third quarter of 2025.
• The company emphasized a significant milestone: the complete separation and disposition of Centuri, which strengthened its balance sheet and paid down all holding company debt.
• This strategic restructuring allows Southwest Gas Holdings to refocus on its core regulated natural gas business, entirely aligned with long-term value creation as a pure-play natural gas utility.

• JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
• The annual index review takes place in August every year. We look at the latest rankings of potential ADDs/DELs every month.
• Below is a look at potential ADDs and DELs for the JPX-Nikkei 400 Rebalance to come in August 2026 based on trading data as of end-November 2025.

• Hokuriku Electric Power is emerging from a period of significant financial distress, having returned to profitability after substantial losses in FY23. This recovery is primarily driven by adjustments in electricity tariffs and lower fuel procurement costs, though the company’s financial base remains fragile.
• The restart of the Shika Nuclear Power Plant is the single most critical catalyst for the company’s medium-term earnings and financial stability. However, the timeline for restart has been pushed back to at least mid-2026 due to damage sustained during the January 2024 Noto earthquake, introducing significant uncertainty.
• Valuation appears attractive, with the company trading at a significant discount to book value and on a low forward P/E ratio. However, this discount reflects the substantial risks associated with its nuclear operations, high debt levels, and the volatile nature of the Japanese power market.

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• Dominion Energy is accelerating into one of the most consequential growth phases in its history, with data centerdriven load growth, multibillion dollar transmission expansions, and the 2.6 gigawatt Coastal Virginia Offshore Wind (CVOW) project advancing toward first power in early 2026.
• Now, reports indicate that Dominion is exploring a potential acquisition of Northern Virginia Electric Cooperative (NOVEC), a move that would deepen its footprint in the world’s busiest data center corridor—Loudoun County’s “Data Center Alley.” The timing is notable: Dominion disclosed that contracted and in process data center demand has surged to roughly 47 gigawatts, up 17% since year end 2024, while the company simultaneously works through major regulatory, financing, and construction milestones across its portfolio.
• Dominion and NOVEC already share deeply interconnected transmission infrastructure, and NOVEC’s customer mix—where data centers account for roughly two thirds of electricity sales—aligns with Dominion’s strategy to serve rapidly rising AI related load.

• Naturgy’s float now stands at 18.6% with re-inclusion into a major index confirmed; €150–250M in tracker flows expected by Feb 2026.
• Liquidity metrics now well above thresholds, with September ADTV at €15.2M, ensuring long-term compliance.
• Passive inflows of €150–250M expected by February 2026; increased ETF demand may tighten spreads, raise visibility, and shift borrow dynamics as short availability potentially declines.

• Atmos Energy Corporation reported a strong fiscal 2025 performance, achieving a diluted earnings per share (EPS) of $7.46, marking the 23rd consecutive year of EPS growth and the 41st consecutive year of dividend growth.
• The company’s results signify successful execution of its strategy focusing on modernization and reliability of its natural gas systems, coupled with a commitment to safety and service expansion.
• Positive outcomes of the fiscal year include substantial customer growth, with approximately 57,000 new residential customers and expansions in the commercial and industrial sectors, suggesting increased demand and confidence in natural gas as a key energy source.

• Essential Utilities, Inc. has presented a transformative quarter, marked by a notable 32% growth in earnings per share year-over-year and several strategic undertakings.
• A key highlight is the merger with American Water, expected to significantly enhance the company’s footprint, serving over 5 million connections across 17 states and strengthening its position as a premier water and wastewater utility firm.
• This merger is anticipated to deliver synergies and present a robust investment case with projected growth rates in earnings per share and dividends of 7% to 9%, propelled by ongoing infrastructure investments.