JPMorgan analysts Jeremy Tonet and Richard W. Sunderland believe utilities in North America are gearing up for a stellar 2025.

Bolstered by accelerating power demand and transformative growth drivers like electrification, data center expansion and manufacturing onshoring, utility stocks are positioned for sustained strength.

Their top picks from the space include Vistra Corp VST, Entergy Corp ETR, NiSource Inc NI and PG&E Corp PCG. Here’s why each of these make a great 2025 pick.

1. Vistra

Vistra's Texas-sized opportunity makes it JPMorgan's top pick.

The company boasts unmatched exposure to the Electric Reliability Council of Texas (ERCOT), a robust integrated retail business and a nuclear production tax credit upside via its Energy Harbor acquisition.

Vistra is uniquely positioned to benefit from soaring baseload demand, tightening power supply and favorable ERCOT pricing. With guidance forecasting double-digit EBITDA growth through 2026, Vistra's potential to secure gas plant contracts and capitalize on regional power price spikes keeps it in the "catbird seat."

Read Also: Appaloosa Hedge Fund Buys Vistra, Sells Boeing

2. Entergy

Entergy has captured the spotlight with its recent data center deals, including Meta Platform Inc.'s META $10 billion investment in Louisiana.

JPMorgan highlights Entergy's ability to replicate such successes, driving load growth and industrial sales compound annual growth rates (CAGR). With surging Gulf Coast demand and replicable engagement frameworks, Entergy continues to outperform with rising earnings guidance and customer expansion.

3. NiSource

NiSource is riding the data center wave in the Midwest, with load scenarios pointing to significant generation needs. Its impressive 6%-8% annual EPS growth and 8%-10% rate base CAGR make it a standout mid-cap utility.

JPMorgan sees inflection potential for NiSource, especially with new load announcements expected to act as catalysts for an upward earnings revision in 2025.

4. PG&E

PG&E shines with its 10% EPS growth outlook and clear runway for financing, thanks to a recent equity raise.

JPMorgan believes PG&E's wildfire mitigation investments, data center pipeline and re-rating potential could drive substantial gains. Updates on its system investment needs in the fourth quarter are likely to serve as pivotal catalysts for growth in 2025 and beyond.

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