Top 15 Utilities Stocks With the Strongest Businesses
Marvin's rules picked 15 Utilities companies with the highest Business Quality scores. NextEra Energy, American States Water and American Electric Power lead the list, which is ranked by quality within the sector.
Utilities companies supply electricity, water and gas, usually in regulated areas. Their revenue tends to be steady, so the differences between them show up in profit margins, debt and how much cash they keep after investing in their networks.
This list answers the question using Marvin's Business Quality score. It is a snapshot as of October 2026 and covers 15 companies, with no more than four from any one industry. A high quality score does not make a company a better choice in every respect, so read each caution.
Several utilities show weak or negative free cash flow because building and upgrading networks costs a lot. Debt is also common in this sector. Use the figures below as a starting point for your own research.
The list
How Marvin ranked these stocks
Marvin included companies above a minimum size cutoff and ranked them by Marvin scores, which run on a scale up to one hundred. The Utilities sector is sorted by highest Business Quality score first, with at most four companies per industry. Every score is relative to the company's own industry, so a water utility is compared with other water utilities, not with power producers or gas companies. That is why the overall score can differ from the quality rank.
Companies above about $300 million in size, ranked by Marvin scores (0-100, relative to each company's own industry). The Utilities sector, highest Business Quality score first; at most 4 per industry.
The stocks, one by one
NextEra Energy, Inc. NEE
NextEra Energy has the top quality score at 97 and an operating margin of 29.5%, so it keeps a healthy share of revenue as operating profit. Revenue grew 10.7% last fiscal year. Caution: debt-to-equity is 1.87, a notable debt level, and free cash flow margin is unavailable.
American States Water Company AWR
American States Water, a regulated water utility, combines a quality score of 96 with an operating margin of 31.8% and a gross margin of 90.1%. Debt-to-equity of 0.65 is among the lower figures here. Caution: free cash flow margin is only 3.0%, so little cash is left after investment.
American Electric Power Company, Inc. AEP
American Electric Power scores 94 on quality, with revenue growth of 10.9% and a free cash flow margin of 11.6%, so it is generating some spare cash. Caution: debt-to-equity is 1.65, meaning debt exceeds equity, and return on equity is a modest 11.9%.
Public Service Enterprise Group Incorporated PEG
Public Service Enterprise Group grew revenue 18.3% last fiscal year, one of the faster rates in this list, and has an operating margin of 23.1%. Its quality score is 90. Caution: free cash flow margin is just 2.2%, and debt-to-equity is 1.42.
Constellation Energy Corporation CEG
Constellation Energy, an independent power producer, has a quality score of 90 but a weaker opportunity score of 25, which holds its overall score to 67. Operating margin is 14.7%. Caution: free cash flow margin is very thin at 1.0%.
OGE Energy Corp. OGE
OGE Energy shows a quality score of 88, an operating margin of 23.9% and a free cash flow margin of 6.9%, a fairly balanced profile. Revenue grew 9.2%. Caution: return on equity is a modest 9.3%, and debt-to-equity is 1.19.
Artesian Resources Corporation ARTNA
Artesian Resources, a regulated water utility, has a strong overall score of 87 and an operating margin of 25.0%, with debt-to-equity of 0.71. Caution: revenue growth is a modest 4.6%, and free cash flow margin is negative at -15.5%, so spending outran cash generated.
ONE Gas, Inc. OGS
ONE Gas, a regulated gas utility, has a quality score of 87 and an overall score of 80. Return on equity is 8.1% and debt-to-equity is 0.96, which is moderate for this list. Caution: growth and margin figures are unavailable, so the picture is incomplete.
Unitil Corporation UTL
Unitil, a diversified utility, grew revenue 8.3% and has an operating margin of 18.9%. Its quality and opportunity scores are both 82 and 85, respectively close. Caution: free cash flow margin is negative at -7.6%, and debt-to-equity is 1.50.
Clearway Energy, Inc. CWEN
Clearway Energy, a renewable utility, has a high free cash flow margin of 42.6% and a gross margin of 64.4%. Its quality score is 80. Caution: return on equity is just 1.8%, the opportunity score is a low 15, and debt-to-equity is 1.81.
UGI Corporation UGI
UGI, a regulated gas company, has a quality score of 81, an operating margin of 16.2% and return on equity of 12.9%, which is decent for the group. Caution: revenue growth was only 1.1% last fiscal year, and free cash flow margin is a thin 2.6%.
Essential Utilities, Inc. WTRG
Essential Utilities, a water utility, grew revenue 18.6% and posted a strong operating margin of 35.1%. Its overall score is 92, helped by an opportunity score of 90. Caution: return on equity is only 7.9%, and free cash flow margin is unavailable.
American Water Works Company, Inc. AWK
American Water Works has the highest operating margin on this list at 37.1%, and revenue grew 10.1% last fiscal year. Its quality score is 75. Caution: free cash flow margin is negative at -19.6%, and debt-to-equity is 1.34.
New Jersey Resources Corporation NJR
New Jersey Resources, a gas utility, has revenue growth of 13.4%, return on equity of 13.9% and an operating margin of 24.8%. Its opportunity score is 93, but quality is 74, the lowest tier here. Caution: free cash flow margin is unavailable, and debt-to-equity is 1.37.
Vistra Corp. VST
Vistra, an independent power producer, has a high return on equity of 40.5% and an operating margin of 18.5%, with a quality score of 70. Caution: debt-to-equity is 3.57, the highest here, revenue growth is just 3.0%, and its overall score is only 46.
Common questions
What does the Business Quality score measure?
It is a Marvin score up to one hundred that describes how a company's business figures, such as margins, returns and debt, compare with other companies in the same industry today. It is not a forecast and not a recommendation.
Why do some companies have a high overall score but a lower quality rank?
The list is ranked by Business Quality, but the overall score also reflects the opportunity score. A company can rank lower on quality and still have a higher overall score, as with Essential Utilities and New Jersey Resources.
Why do many utilities show weak free cash flow and higher debt?
Utilities spend heavily on pipes, wires, plants and other infrastructure, and they often borrow to pay for it. That can leave little or negative free cash flow even when operating margins are strong, so check both figures together.
Keep reading
- Top 15 Utilities Stocks by Marvin Scores
- Top 15 Utilities Stocks by Marvin's Opportunity Score
- Top 15 Regulated Electric Stocks
- Top 20 Defensive Stocks Ranked by Marvin Business Quality
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Marvin's scores (0-100) compare each company with others in its industry today. Growth and margin figures come from SEC filings. This is general information, not personal investment advice or a recommendation to buy or sell anything. Do your own research.