AI-driven power demand is reshaping the entire utility sector. Two companies positioned to capitalize on what will be a years-long trend are NextEra Energy (NEE 0.06%) and The Southern Company (SO +1.64%). Both utility stocks offer their own value propositions for long-term investors. Let's have a look at each.
NYSE: NEE
Key Data Points
NextEra is experiencing a power and profit surge
NextEra owns and operates the nation's largest electric utility provider, Florida Power & Light (FPL). It's also a leader in renewable energy. NextEra is on a rare growth trajectory. Through FPL, NextEra may seem like your typical regulated electric company, but population growth in Florida and increasing data center demand is transforming what's normally a boring income-producing business into a growth powerhouse.
Image source: Getty Images.
This trend also further enables NextEra's renewables side to scale. FPL revenue accounted for the bulk of NextEra's total revenue, approximately 66% of the $27 billion it brought in for all of 2025. NextEra's renewables arm posted an impressive $8.7 billion of revenue for fiscal year 2025, a $1.2 billion increase from 2024.NextEra anticipates growth of at least 8% through 2032. It also expects to increase its dividend 10% in 2026, and then 6% through 2028. The company's growth projections are welcomed news for buy-and-hold investors.
The Southern Company will increase your income
The Southern Company might not have all the growth levers NextEra has, but it does have a higher dividend yield as well as data center demand, particularly in Georgia and Alabama. Southern Company will release its fourth quarter 2025 earnings on Feb. 19, but in its last quarter, the Atlanta-based company showed impressive growth, with quarterly revenue up 7.5% year over year.
I predict much of the same for Southern Company when it releases its fourth-quarter earnings.
NYSE: SO
Key Data Points
Southern Company has consistently raised its dividend for 24 consecutive years. Its dividend yield is solidly over 3%. In the past 12 months, Southern Company's stock has risen 10% compared to NextEra's 38%, but Southern Company holds its own with lower volatility and higher income. It is an excellent ballast for any stock portfolio.
Which should investors buy?
Both of these stocks offer investors a way to invest in AI infrastructure with strong growth potential and valuable income. Collectively, power demand could increase by 25% by 2030. The growth rate that utility companies are projecting across the board far exceeds historical norms. Where utility companies used to be merely a defensive portfolio play, that view is now shifting due to AI-related electricity demand.
Whether your portfolio is geared more toward income or more toward growth, both Southern Company and NextEra Energy seem like no-brainer picks for the month of February.
