UBS Spotlights Top US Energy and Utilities Stocks on Growth Catalysts

Investment bank UBS has identified its leading stock picks across seven segments of the U.S. Energy, Mining, and Utilities sectors. The firm's analysis pinpoints companies poised for growth driven by specific catalysts, including strategic acquisitions, expanding production, and key operational developments.

Top Selections Across Key Industries

In a new report, UBS outlined its top choices, providing the investment thesis for each selection:

• Clean Energy: Nexpower (NXT) - The bank anticipates Nexpower will raise its fiscal 2030 revenue target from $5.2 billion at its upcoming Capital Markets Day. UBS models a potential $1.4 billion incremental revenue opportunity from new product lines and projects fiscal 2030 EBITDA of $1.55 billion, which is 2% above consensus estimates.
• Integrated Oil: Canadian Natural (CNQ) - UBS highlights the company's near-term volume growth, targeting a 5.7% production increase in 2026 over 2025 levels. The firm notes that the TMX pipeline has tightened heavy oil differentials, benefiting CNQ's upstream operations, and expects robust share buybacks.
• Metals & Mining: First Quantum Minerals (FM) - The selection is contingent on the sustained restart of the Cobre Panama mine, which UBS is confident will be agreed upon in the next six to nine months. At spot prices, the company is trading at 5.0 times its estimated 2028 enterprise value to EBITDA.
• Midstream & Natural Gas: Kinder Morgan Inc (KMI) - The firm points to a growing project backlog, which added approximately $650 million in Q4 2025. The total backlog of roughly $10 billion is expected to add over $1.67 billion in earnings growth, with a build multiple of less than 6 times EBITDA.
• Exploration & Production: Devon Energy (DVN) - Key upcoming catalysts include planned divestitures of assets in the Eagle Ford and Anadarko basins, the company's 2027 outlook, and synergy capture from its Catera acquisition.
• Oil Services & Equipment: Liberty Energy (LBRT) - Following a more than 20% stock decline after its Q2 2026 update, UBS sees significant upside potential. The bank expects the company to sign over 500 megawatts of energy services agreements in the second half of 2026.
• Utilities: American Water Works (AWK) - UBS sees building momentum from merger settlements or approvals in six of eight required states. The firm's price target of $162 represents a 15% price-to-earnings premium for the water utility sector.

Ad

What This Means for Investors

The selections from UBS emphasize company-specific factors over broad market trends. The analysts are focused on tangible events—such as asset sales, major project restarts, and regulatory approvals—that could unlock value for shareholders independent of wider economic shifts.

For market participants, this list provides insight into where the investment bank sees distinct opportunities for growth and operational improvement. The rationale for each pick is tied to measurable financial projections and strategic milestones, offering a detailed view of the potential drivers for each stock.