Observed Signal · Jul 22, 2026 · Analyst Report · Source: CNBC Investing · Impact: 1/5 · Sentiment: Neutral
Wells Fargo: Utilities Could Benefit from AI Trade
Wells Fargo analysts, led by Sharr Pourreza, said 'out-of-favor' utilities could become beneficiaries of the AI-driven demand wave, particularly once regulatory and policy overhangs tied to the PJM Interconnection clear. The bank highlighted specific utilities — including Exelon, FirstEnergy, PPL and Public Service Enterprise Group — as potential winners that also offer above-market dividend yields. The report cites risks such as regulatory uncertainty, pushback on data center construction, and rising power costs, and notes FERC will hold a conference to consider PJM's future. Wells Fargo recommends owning utilities for diversification and potential re-rating if policy clarity emerges.
Limited direct relevance to AdTech/MarTech; primary energy/investment story. May be tangentially relevant because data center power and AI infrastructure can affect AI compute availability.
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Key Takeaways & Evidence Grounding
- Wells Fargo analysts, led by Sharr Pourreza, said utilities have lagged the S&P 500 by ~330 basis points year-to-date but could re-rate with regulatory clarity.
- Wells Fargo highlighted Exelon, FirstEnergy, PPL and Public Service Enterprise Group as potential beneficiaries of AI-related transmission and generation opportunities.
- Exelon shares were up 7% in 2026 and had a dividend yield of 3.6%; Exelon reported Q1 operating earnings of $0.91 per share and reaffirmed full-year operating earnings guidance of $2.81 to $2.91 per share.
- FirstEnergy reaffirmed its 2026 core earnings forecast of $2.62 to $2.82 per share, reported a 32% increase in contracted demand from data centers, and its shares were up nearly 10% year-to-date with a 3.8% dividend yield.
- The Federal Energy Regulatory Commission (FERC) planned a conference to consider the future of the PJM Interconnection, including the possibility of a breakup, according to Bloomberg.
Connected Companies & Entities
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Ontology Mapping & Concepts
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Morgan Stanley Names Williams a Top AI-Linked Pick
Morgan Stanley named The Williams Companies a top pick, saying the energy-infrastructure company offers a compelling way to participate in the AI infrastructure buildout. The firm has an overweight rating and a $103 price target — about 45% above the stock's close — and analyst Robert Kad highlighted expected returns from Williams' data-center power solutions and an imminent new power project announcement. Williams shares have fallen roughly 7% over the past three months. LSEG data shows 19 of 23 analysts covering the company rate it buy or strong buy. The article was published by CNBC on 2026-08-26.
Investing in Energy Tech: The Smart Move for AI Boom
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Wall Street's Top Picks: High-Yield Energy Dividend Stocks
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