Freedom Broker has highlighted five energy companies benefiting from the data center boom in the U.S.

The rapid development of the data center network in the US will be the main driver of energy consumption in the coming years: this plays into the hands of companies operating in the electricity market. This is according to a note by analysts at Freedom Broker (available from Oninvest). They highlighted five utility stocks that could benefit from this boom.

According to the Energy Information Administration (EIA) forecast cited by Freedom Broker, the country's total electricity consumption will increase by 2.3% in 2025 and another 2.1% in 2026. At the same time, the country's outdated power system is already under strain, making multi-billion-dollar investments in modernization inevitable, analysts say.

With this in mind, they have compiled a list of companies that could benefit from this trend. In doing so, Freedom Broker based the most attractive valuation on a P/E multiple (share price to projected earnings) for 2027, dividend yield for 2026 and current debt levels, according to the note.

Which companies did the analysts highlight?

It is one of the largest and most diversified power companies in the U.S., active in Ohio and Texas, regions where demand for power from data centers is growing rapidly. AEP is investing in modernizing its grid to improve reliability and capacity, leading to a growing revenue base, Freedom Broker noted.

At the same time, the company is subject to different regulatory regimes in the states, which complicates forecasting. The consensus target price is $114.3 per share, which is almost the same as the closing price on August 21.

On trades on August 22 AEP securities were growing by about 0.6%. The stock has a total of 21 recommendations from analysts, and the most popular one is Hold (12 Hold ratings), MarketWatch shows.

Through its subsidiary Arizona Public Service (APS), PNW is the largest utility operator in Arizona and directly benefits from industrial development in the region - including the large-scale construction of semiconductor plants. For example, Taiwanese chipmaker TSMC (Taiwan Semiconductor Manufacturing Company) is investing about $65 billion in capacity in Arizona.

The main risks for PNW are high dependence on one jurisdiction (Arizona) and long-term environmental challenges like water shortages in Arizona. The consensus estimate is $96, which implies a potential upside of up to 5.5%.

PMW stock was up about 0.3% on August 22. The stock has 16 ratings from analysts and most advise Hold (10 Hold), though five recommend Buy and only one recommends Sell (Underweight), according to MarketWatch.

The company has a leading position in Northern Virginia, the world's largest and most energy-intensive data center market. Dominion is receiving direct requests for new gigawatt capacity and is investing billions to expand and modernize its networks, Freedom Broker writes.

Among the risks, analysts emphasize high concentration of business in one region and possible tightening of regulation. The consensus estimate is $60, with a downside potential of up to 2%.

Shares of Dominion were up 1.5% on August 22. They have 16 recommendations from analysts, with the vast majority advising to hold (13 Hold).

The company has strong positions in North and South Carolina and the Midwest, regions where demand for new data centers and industrial construction is growing rapidly. Duke is implementing a five-year, $87 billion investment program, mostly focused on grid modernization, including the construction of more than 7 GW of gas-fired power plants, analysts said.

The main risk for the company is related to the scale of the investment plan: it is necessary not only to fulfill it without delays and cost overruns, but also to get regulators' approval for tariff increase in different states in order to return the invested funds. The consensus valuation of the stock is $131.4, which suggests a potential upside of up to 6%.

Duke securities were adding 0.3% in trading on Friday. Most analysts advise to hold (13 Hold out of 20 in total), the rest recommend buying, MarketWatch shows.

A large, diversified utility with operations in eight states is betting on data center growth in Minnesota and Colorado. Its confirmed portfolio of interconnection requests reaches 8.9 GW. To realize it, the company will invest $45 billion over five years, which should deliver an average 9.4% growth in revenue base through 2029, according to Freedom Broker.

Risk - potential liability for damage from forest fires and complexity of regulation. Consensus estimate - $77, upside potential up to 5.5%.

Xcel stock was up 1.2% on August 22. They have 16 recommendations from analysts, and the most popular one is Buy (nine ratings Buy and one Overweight). Five more think the securities should be held (Hold), one - that to sell (Underweight).

Melius Research analysts on August 20 also advised on stocks that could benefit from the rise of artificial intelligence and the associated increase in electricity consumption. Melius began analyst coverage of five companies at once: Constellation Energy, Vistra, NextEra Energy, NRG Energy and Talen Energy. Each has been assigned a Buy rating by analysts.

This article was AI-translated and verified by a human editor