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Energy stocks top S&P 500 sectors in August; utilities slide to bottom

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Energy stocks top S&P 500 sectors in August; utilities slide to bottom

Energy closed the month of August as the only S&P 500 sector to log positive returns amid a general selloff among other industries. On the other end of the spectrum, utilities emerged as the worst-performing sector during the month.

The S&P 500 Energy index notched a 1.8% gain during the month, while the S&P 500 Utilities index slid to the bottom of the list with a negative return of 6.2%.

The broader S&P 500 index saw a negative return of 1.6%.

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Among energy companies, APA Corp. posted a positive stock return of 8.3%. The company reported second-quarter adjusted production of 325,000 barrels of oil equivalent per day, up 2% from the first quarter, driven primarily by a 6% increase in US oil volumes.

Marathon Petroleum Corp., which saw a positive return of 7.9% in August, recorded second-quarter adjusted EBITDA of $4.53 billion, compared with $9.06 billion a year earlier.

Pioneer Natural Resources Co. closed the month with a gain of 5.4%. The company placed 124 horizontal wells in production during the second quarter.

Other best-performing energy stocks in August included Targa Resources Corp. and Exxon Mobil Corp.

On the flip side, Devon Energy Corp. recorded a negative return of 5.39%. The company's oil production averaged 323,000 b/d in the second quarter, an increase of 8% from the year-ago period.

Other laggards included EOG Resources Inc., Kinder Morgan Inc., Oneok Inc. and Halliburton Co., all recording negative stock returns in August.

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In the utilities sector, Constellation Energy Corp. came out as the only company that logged a positive return in August at 8.1%. The nuclear generation giant reported second-quarter adjusted EBITDA of $1.03 billion, compared to $603 million a year earlier. The S&P Capital IQ consensus EBITDA estimate for the second quarter was $707.8 million.

Among bottom-performing utilities, AES Corp. slumped 17.1% in August. AES' second-quarter adjusted earnings per share were 21 cents, down from 34 cents during the prior-year period. The S&P Capital IQ consensus normalized EPS estimate was 24 cents.

The company expects to exceed a $3 billion asset sale target for 2023 through 2027 that management detailed in May as part of a $38 billion to $43 billion capital spending program.

Eversource Energy posted a negative stock return of 11.8%, as the energy provider recorded a $331.0 million after-tax impairment related to its offshore wind business for the second quarter, up from the $220 million to $280 million charge the developer estimated in May.

PPL Corp. saw a negative stock return of 9.5%, as storms and mild weather dragged the company's earnings by 9 cents per share through the first half of 2023.

DTE Energy Co. and Xcel Energy Inc. also logged share price drops of 9.6% and 8.9%, respectively.

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