Top 3 Utilities Stocks That May Rocket Higher This Quarter - Sunnova Energy Intl (NYSE:NOVA), Cadiz (NASDAQ:CDZI)

The most oversold stocks in the utilities sector presents an opportunity to buy into undervalued companies.

The RSI is a momentum indicator, which compares a stock’s strength on days when prices go up to its strength on days when prices go down. When compared to a stock’s price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered oversold when the RSI is below 30, according to Benzinga Pro.

Here’s the latest list of major oversold players in this sector, having an RSI near or below 30.

Sunnova Energy International Inc NOVA

On April 1, Sunnova named Robyn Liska as interim CFO. “Robyn has deep industry knowledge and a proven record of driving financial transformation,” said Paul Mathews, Sunnova Chief Executive Officer. “Her expertise will be invaluable as we continue to work to stabilize our foundation, sharpen our execution, and position Sunnova to succeed in today’s evolving solar energy market.” The company’s stock fell around 44% over the past month and has a 52-week low of $0.25.
RSI Value: 26.3
NOVA Price Action: Shares of Sunnova Energy fell 11.3% to close at $0.33 on Tuesday.
Edge Stock Ratings: 0.48 Momentum score with Value at 89.09.

Cadiz Inc CDZI

On March 7, Cadiz Inc. announced a $20 million registered direct offering. The offering involves the sale of 5,715,000 shares of its common stock at $3.50 per share. The company expects to use the net proceeds for capital and other expenses related to the development and construction of its Mojave Groundwater Bank project.. The company’s stock fell around 28% over the past month and has a 52-week low of $2.12.
RSI Value: 29
CDZI Price Action: Shares of Cadiz gained 0.7% to close at $2.95 on Tuesday.
Benzinga Pro’s charting tool helped identify the trend in CDZI stock.

The market reception of the recent earnings reports from Alphabet (GOOGL) and Tesla (TSLA) left much to be desired among investors. This reaction, particularly towards Alphabet's results, may serve as an ominous foreshadowing of what is to come this week as four other members of 'The Magnificent 7' gear up to report.

Alphabet vs. Tesla Performance

Despite Tesla missing consensus estimates and facing margin pressures, Alphabet managed to beat estimates with several positive outcomes, notably in search and cloud areas. However, the spotlight shifted to Alphabet's larger-than-anticipated capital expenditures, raising concerns about ongoing AI-focused capex and its eventual returns. The worries were accentuated by Alphabet's management highlighting the risk of underinvestment. In contrast, Tesla experienced a drop in Q2 earnings, while Alphabet marked a 28.6% increase year-over-year with a 15% rise in revenues.

Future Outlook for Mag 7

The impending reports from Meta Platforms, Microsoft, Amazon, and Apple are expected to reflect on capital expenditures, growth trends in cloud services, and market skepticism towards AI initiatives. Amazon faces scrutiny over decelerating cloud growth compared to its peers, while Apple's focus remains on evolving iPhone trends in the Chinese market.

Group Performance and Expectations

The 'Mag 7' stocks are projected to showcase a 26.8% surge in earnings and a 13.7% increase in revenues compared to the same period last year. This sector is a crucial driver of the broader Technology industry, which anticipates a 16.8% earnings uptick and 9.5% revenue growth for Q2.

Industry Sector Growth Analysis

The Technology sector, buoyed by an upswing in estimates for the Mag 7 stocks, has witnessed a positive trend in recent quarters. The upcoming earnings season, with a multitude of companies preparing to report results, including key players like McDonald’s, Proctor & Gamble, and Pfizer, is expected to provide further insights into sector performance.

Earnings Landscape Overview

With over 41% of S&P 500 members already having disclosed Q2 results, the overall earnings show a modest 0.6% increase year-over-year alongside a 4.9% rise in revenues. As the reporting cycle gains momentum, eyes are on the broader market to gauge earnings and revenue beats.

Insights Into Q2 Revenue Trends

Notably, the Q2 revenue beats percentage hit a historic low of 57.5% for the 207 index members, indicating a demanding quarter compared to the last two decades.

Earnings Big Picture Analysis

When considering the aggregate picture for Q2, S&P 500 earnings are predicted to grow by 6.9% year-over-year with a 5.2% increase in revenues. The promising revisions trend observed prior to the earnings season underscores a positive outlook for the quarter's financial performance.

Analysis of Index Level Aggregate Earnings GrowthThe Landscape of Aggregate Earnings Growth

Spruce Power Holding Corp SPRU

On March 31, Spruce Power Holding reported a quarterly loss of 29 cents per share, versus a year-ago loss of $1.60 per share. “In this time of heightened uncertainty across the residential solar market, Spruce offers investors greater stability and predictability given that our business is predicated on generating long-term contracted cash flows from existing solar assets through operational efficiencies, maintenance and superior asset management,” said Chris Hayes, Spruce’s Chief Executive Officer. The company’s stock fell around 20% over the past five days and has a 52-week low of $2.08.
RSI Value: 25.4
SPRU Price Action: Shares of Spruce Power fell 12% to close at $2.12 on Tuesday.
Benzinga Pro’s signals feature notified of a potential breakout in SPRU shares.