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Reasons to Add National Grid Stock to Your Portfolio Now

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National Grid (NGG - Free Report) is poised to benefit from its systematic investment to upgrade and expand infrastructure. Rising demand from new customer connections and its low-risk, high-quality asset make NGG a solid investment option in the utility sector.

Let us focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.

NGG’s Earnings Growth Projections

The Zacks Consensus Estimate for fiscal 2025 and 2026 earnings per share (EPS) has increased 0.21% and 0.58%, respectively, in the past 60 days.

Zacks Investment Research
Image Source: Zacks Investment Research

National Grid’s long-term (three to five years) earnings growth rate is 2.34%.

NGG’s Focus on Clean Energy

The company is enabling the energy transition for all and aims to reach net-zero emissions by 2050. National Grid is working with its partners to accelerate the development of a clean energy future. In the United States, NGG has made significant investments in large-scale renewable energy projects, including wind and solar.

Demand From New Customers

The company will benefit from rising demand from new customer connections in its service region. National Grid will enjoy the benefit of 2.3 gigawatts of additional demand coming from new customers. The company also received transmission-scale data center connection requests.

NGG’s Solvency

The time-to-interest earned ratio at the end of fiscal 2024 was 2.8. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.

National Grid’s Dividend Yield

NGG has been consistently increasing shareholders’ value by paying dividends. The company's current dividend yield is 2.84%, up from the S&P 500 Composite's 1.66%.

NGG’s Systematic Investments

National Grid has plans to invest nearly $69 billion (£ 60 billion) across its service territory in the United Kingdom and the United States over the next five years, with nearly half of the funding dedicated to U.S. energy system improvements in Massachusetts and New York.

NGG Stock’s Price Performance

In the past six months, the stock has gained 6.5% against the industry’s decline of 4%.

Zacks Investment Research
Image Source: Zacks Investment Research

Other Stocks to Consider

A few other top-ranked stocks from the same industry are Exelon Corporation (EXC - Free Report) , The AES Corporation (AES - Free Report) and Consolidated Edison (ED - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

EXC’s long-term earnings growth rate is 5.99%. The Zacks Consensus Estimate for 2025 EPS has moved up by 1.14% in the past 60 days.

AES’ long-term earnings growth rate is 3.32%. The Zacks Consensus Estimate for 2025 EPS has moved up by 5.94% in the past 60 days.

ED’s long-term earnings growth rate is 5.57%. The Zacks Consensus Estimate for 2025 EPS reflects year-over-year growth of 4.07%.
 

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