Utilities may benefit from AI demand, Wells Fargo says

Wells Fargo says some utility stocks could benefit from the artificial intelligence buildout as power demand from data centers rises. The bank argues that several overlooked utilities have lagged the broader market this year, but may see improved performance if regulatory and policy uncertainty eases. The report points to concerns around grid rules, data center expansion, and ongoing questions tied to PJM Interconnection, a major regional grid operator serving parts of the eastern U.S. Wells Fargo said those headwinds could fade over time, potentially helping utility shares rerate. Among the companies highlighted were Exelon, FirstEnergy, PPL, and Public Service Enterprise Group. The firms were noted for their exposure to transmission and generation opportunities linked to AI infrastructure, along with dividend yields that remain above the market average.