Q: What insights do you have for the Utility sector in 2025? It was out of favor, caught a bid for a while and now it's falling back again. The yield is obviously nice but do you see the price continuing to decline? Thanks as always, great service.
5i Research Answer:
Utilities benefited from both a tailwind via the AI and increased energy demand theme, as well as reduced interest rates and the heavy debt burdens that most utility stocks have. We could see the utility sector consolidate a bit more after its large run over the past year, but largely, we feel the sector has good tailwinds and has been fairly under-owned, and we would be comfortable holding utility stocks over the next couple years.
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