Top 3 US utility stocks to buy in October 2021

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on Oct 12, 2021
  • US utility stocks are bouncing back after pulling back last month.
  • NRG Energy shares are up nearly 3% over the last five days while UGI and Spire have also bounced back.
  • The three stocks also trade at attractive valuation multiples, making them exciting to investors.

With US utilities bouncing back to recover from last month’s losses, we sifted through some of the top-rated picks to identify three strong candidates to consider buying in October 2021.

 All these stocks trade at incredible valuation multiples and seem to have bottomed, triggering a rebound.

UGI Corp

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UGI Corp (NYSE:UGI) shares have bounced back more than 4% this month after plummeting more than 10% in September. The stock trades at an attractive P/E ratio of about 9.79, making it a compelling option for value investors.

Moreover, analysts expect UGI earnings per share to increase by more than 79% this year, thereby gaining the attention of growth investors. 

Source – TradingView

Technically, UGI seems to be trading within an ascending channel formation after bottoming late last month. However, the stock is still far from reaching overbought conditions and remains several levels below the 100-day moving average.

Therefore, investors could target profits at about $46.08, or higher at $47.24, while $43.50 and $42.25 are crucial support levels.

Spire

Spire Inc. (NYSE:SR) has recouped nearly 5% in market value after plunging more than 15% between 16th August and 30th September. The stock trades at a compelling P/E ratio of 13.43, whilst paying dividends at a yield of 4.06%.

Both value investors and dividend stock hunters could find the SR stock as a compelling option for their portfolios.

Source – TradingView

Technically, although the stock has bounced back to recover from oversold conditions, it is still far from reaching overbought conditions. Therefore, SR seems to have room left to run amid its recovery.

Investors could target extended gains at $65.67, or higher at $67.62. On the other hand, if SR pulls back to take a breather, it could find support at $62.64, or lower at $60.91.

NRG Energy

NRG Energy Inc. (NYSE:NRG) shares fell more than 10% in September. However, the stock has bounced back 2% in the previous five trading sessions, amid the recovery in utility stocks.

The stock trades at an exciting trailing 12-month P/E of 9.46 and a forward P/E of 7.90. Moreover, analysts expect its EPS to grow at an average annual rate of 42% over the next five years, making it an exciting option for growth investors.

Source – TradingView

Technically, NRG shares still seem to be trading within a descending channel formation in the intraday chart. However, the stock appears to have found support from the 100-day moving average, triggering a rebound.

Therefore, investors could target extended rebound profits at $43.22, or higher at $45.42, while $38.81 and $36.54 are solid support levels.

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