Dominion Energy's Growth Amid Rising Power Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 14 2024
0mins
Should l Buy D?
Source: Business Insider
Dominion Energy's stock rose 3.01% and reached a 52-week high amid a challenging market environment where the Nasdaq-100 and S&P 500 are down.
The company's strong performance is attributed to its crucial role in supplying power to over 35% of the world's hyperscale data centers, which is driving sustained revenue growth. CEO Robert Blue highlighted the ongoing demand for additional power supply from data center customers, with 450 data centers already connected. Furthermore, Dominion Energy reported a 10.2% year-over-year increase in operating earnings, indicating robust profitability and a projected annualized EPS growth of 5% to 7% through 2029, making it attractive for investors.
As the demand for electricity continues to surge, particularly from data centers, Dominion Energy is well-positioned to capitalize on this trend, enhancing its market competitiveness and appealing to income-focused investors with a current dividend yield of 4.4%.
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Analyst Views on D
Wall Street analysts forecast D stock price to fall
12 Analyst Rating
2 Buy
9 Hold
1 Sell
Hold
Current: 65.650
Low
59.00
Averages
64.36
High
70.00
Current: 65.650
Low
59.00
Averages
64.36
High
70.00
About D
Dominion Energy, Inc. provides regulated electricity service to about 3.6 million homes and businesses in Virginia, North Carolina, and South Carolina, and regulated natural gas service to 500,000 customers in South Carolina. It is a developer and operator of regulated offshore wind and solar power and the producer of carbon-free electricity in New England. Its Dominion Energy Virginia segment is composed of Virginia Power’s regulated electric transmission, distribution, and generation operations, which serve homes and businesses in Virginia and North Carolina. Its Dominion Energy South Carolina segment consists of DESC’s generation, transmission, and distribution of electricity to customers in the central, southern and southwestern portions of South Carolina and the distribution of natural gas to residential, commercial and industrial customers in South Carolina. Its Contracted Energy segment includes non-regulated electric generation fleet and renewable natural gas operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Rising Electricity Prices: With electricity prices spiking 6.9% year-over-year in 2025, public anxiety about the economy is increasing, as Navarro attempts to blame former President Biden, indicating the current administration's challenges in addressing inflation.
- Policy Response Measures: The Trump administration has signed a pact with several states urging major tech companies to finance $15 billion for new power plants to alleviate the strain data centers place on the grid, demonstrating proactive government intervention in energy policy.
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- Diverse Investment Opportunities: Dominion Energy, a diversified utility, operates four nuclear plants, with the Millstone plant supplying half of Connecticut's electricity; its current dividend yield stands at 4.19%, and despite a high payout ratio of 99.6%, its stable operating margin of 29.45% continues to attract investor interest.
- Small Modular Reactors: BWX Technologies focuses on developing small modular reactors, which are compact yet powerful, designed to provide independent power to data centers and reduce reliance on local grids; while not yet deployed, the technology holds significant promise for the future.
- Growing Dividends: BWX Technologies has raised its dividend at an annualized growth rate of 4.28% over the past five years, with a current yield of only 0.5%, but its low payout ratio of 26% allows ample room for future dividend growth, highlighting the company's potential in nuclear innovation.
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- Dominion Energy's Edge: Dominion Energy operates four nuclear plants on the East Coast, with the Millstone Nuclear Plant generating half of Connecticut's electricity, currently offering a dividend yield of 4.19%; despite a high payout ratio of 99.6%, its stable operating margin of 29.45% positions it as a reliable investment choice.
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- Dividend Growth Potential: BWX's dividend yield stands at 0.5%, lower than Dominion's, but its annualized growth rate of 4.28% over the past five years and a low payout ratio of 26% provide ample room for future dividend increases, appealing to long-term investors seeking growth.
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- Surging Power Demand: The company serves over 3.6 million homes and businesses in Virginia and North Carolina, experiencing a spike in electricity demand that is expected to drive annual revenue growth exceeding 25%, solidifying its leadership position in the utility sector.
- Dividends and Financial Health: While Dominion's dividend yield stands at approximately 4.3%, its high payout ratio of 87% raises concerns; however, its record of 392 consecutive quarters of dividends reflects stable cash flows, bolstering investor confidence.
- Enbridge's Growth Potential: Enbridge's renewable energy segment saw a 16% year-over-year increase in EBITDA to $100 million, and although its fossil fuel operations account for 60% of total revenue, investments in renewable projects indicate significant future growth potential.
See More
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- Cost Internalization for Data Centers: White House trade advisor Peter Navarro stated that data center builders must absorb costs related to electricity and water usage, highlighting the government's concern over economic pressures that could impact companies like Meta.
- Rising Electricity Prices: With electricity prices spiking 6.9% year-over-year in 2025, public anxiety about the economy is increasing, as Navarro attempts to blame former President Biden, indicating the current administration's challenges in addressing inflation.
- Policy Response Measures: The Trump administration has signed a pact with several states urging major tech companies to finance $15 billion for new power plants to alleviate the strain data centers place on the grid, demonstrating proactive government intervention in energy policy.
- Election Outlook Impact: As the November 2026 midterms approach, polls show Democrats leading by 5.2 points, reflecting voter concerns over economic issues that could affect Trump's and the Republican Party's electoral prospects.
See More
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- Nuclear Production Goals: The U.S. Department of Energy aims to triple nuclear energy production by 2050 in response to the surge in electricity demand from artificial intelligence, with global consumption expected to double by 2030, thus revitalizing the nuclear sector.
- Diverse Investment Opportunities: Dominion Energy, a diversified utility, operates four nuclear plants, with the Millstone plant supplying half of Connecticut's electricity; its current dividend yield stands at 4.19%, and despite a high payout ratio of 99.6%, its stable operating margin of 29.45% continues to attract investor interest.
- Small Modular Reactors: BWX Technologies focuses on developing small modular reactors, which are compact yet powerful, designed to provide independent power to data centers and reduce reliance on local grids; while not yet deployed, the technology holds significant promise for the future.
- Growing Dividends: BWX Technologies has raised its dividend at an annualized growth rate of 4.28% over the past five years, with a current yield of only 0.5%, but its low payout ratio of 26% allows ample room for future dividend growth, highlighting the company's potential in nuclear innovation.
See More
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- Nuclear Production Goals: The U.S. Department of Energy aims to triple nuclear energy production by 2050 to meet the surging electricity demand driven by artificial intelligence, with global electrical consumption expected to double by 2030, highlighting nuclear energy's critical role in future energy strategies.
- Dominion Energy's Edge: Dominion Energy operates four nuclear plants on the East Coast, with the Millstone Nuclear Plant generating half of Connecticut's electricity, currently offering a dividend yield of 4.19%; despite a high payout ratio of 99.6%, its stable operating margin of 29.45% positions it as a reliable investment choice.
- BWX's Technological Innovation: BWX Technologies focuses on developing small modular reactors (SMRs), which, while not yet deployed, show significant potential; in its latest quarter, the company reported a 29% revenue increase, a 19% rise in net income, and a 20% growth in earnings per share, indicating strong market demand and growth prospects.
- Dividend Growth Potential: BWX's dividend yield stands at 0.5%, lower than Dominion's, but its annualized growth rate of 4.28% over the past five years and a low payout ratio of 26% provide ample room for future dividend increases, appealing to long-term investors seeking growth.
See More
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- Honoree Recognition: The 2026 Strong Men & Women in Virginia History honorees include Corporate Attorney Sharon Bowen, posthumous U.S. Army Officer William Hughes Dillard, Civil Rights Pioneer Sheary Ann Darcus Johnson, and Public Health Advocate Florence Neal Cooper Smith, highlighting their significant contributions and impact in their respective fields.
- Student Creative Contest: Virginia high school students participated in a creative contest to honor outstanding African Americans, with winner Vrinda Shah designing a website to celebrate the legacy of Dr. Gladys Mae West, showcasing the younger generation's commitment to history and innovation.
- Exhibition Activities: The Library of Virginia will host a traveling exhibition featuring the honorees' biographies, aimed at educating the public about these remarkable leaders and enhancing community awareness and respect for history.
- Project Origins: Launched in 2013 by Dominion Energy and the Library of Virginia, this initiative merges two significant Black History Month programs, aiming to elevate awareness and respect for African American history through education.
See More
Trump Administration to Appeal Rulings Blocking Offshore Wind Farms
- National Security Concerns: U.S. Secretary of the Interior Doug Burgum stated that the Trump administration's crackdown on the offshore wind industry is not an ideological attack but a genuine concern regarding national security risks, claiming that offshore wind farms could interfere with radar systems, making the U.S. more vulnerable to drone attacks.
- Court Rulings Overturned: U.S. judges have overturned five orders from President Trump aimed at halting multi-billion-dollar offshore wind projects, with the most recent ruling involving a project off Long Island developed by Ørsted, indicating judicial support for wind energy initiatives.
- Project Resumption Progress: The same D.C.-based district judge previously allowed Ørsted to resume work on its Revolution Wind project off Rhode Island, reflecting a supportive judicial stance that may bolster investment confidence in offshore wind projects.
- Optimistic Industry Outlook: Other projects by Dominion Energy, Equinor, and Iberdrola have also prevailed in court, demonstrating the resilience of the offshore wind industry in the face of regulatory pressures, suggesting a positive outlook for future developments in this sector.
See More
Dominion Energy and Enbridge's Green Energy Strategies
- Renewable Energy Investment: Dominion Energy plans to invest $50 billion over the next five years, with over 80% allocated for zero-carbon power generation and grid modernization, aiming to meet the surging demand from data centers and enhance its competitive edge in the green energy market.
- Surging Power Demand: The company serves over 3.6 million homes and businesses in Virginia and North Carolina, experiencing a spike in electricity demand that is expected to drive annual revenue growth exceeding 25%, solidifying its leadership position in the utility sector.
- Dividends and Financial Health: While Dominion's dividend yield stands at approximately 4.3%, its high payout ratio of 87% raises concerns; however, its record of 392 consecutive quarters of dividends reflects stable cash flows, bolstering investor confidence.
- Enbridge's Growth Potential: Enbridge's renewable energy segment saw a 16% year-over-year increase in EBITDA to $100 million, and although its fossil fuel operations account for 60% of total revenue, investments in renewable projects indicate significant future growth potential.
See More
