NEW YORK (TheStreet) -- The utilities sector was one of the few that outperformed the broader markets in the third quarter, as investors fled to safety during the market turbulence. 

The S&P 500 Utilities Index rose 4.4% for the three-month period, ending Sept. 30, while the broader S&P 500 fell 6.9% -- its worst quarterly performance in four years -- as a result of the quarter's choppy markets.

That said, utilities had some clear winners. Here are the 10 best-performing utilities stocks in the third quarter, paired with TheStreet Ratings to let you know if you should still buy these stocks in the final quarter of the 2015.

TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

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10. Scana Corp. (SCG)
Industry: Utilities Non-Telecom/Multi-Utilities
Market Cap: $7.8 billion
Year-to-date return: 11.1%

TheStreet Said: TheStreet Ratings team rates SCANA CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate SCANA CORP (SCG) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, notable return on equity, reasonable valuation levels and good cash flow from operations. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Multi-Utilities industry average. The net income increased by 3.1% when compared to the same quarter one year prior, going from $96.00 million to $99.00 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Multi-Utilities industry and the overall market, SCANA CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to $182.00 million or 11.65% when compared to the same quarter last year. Despite an increase in cash flow, SCANA CORP's cash flow growth rate is still lower than the industry average growth rate of 41.60%.
  • You can view the full analysis from the report here: SCG

 

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9. Eversource Energy (ES - Get Report)
Industry: Utilities Non-Telecom/Electric Utilities
Market Cap: $15.6 billion
Year-to-date return: 11.5%

TheStreet Said: TheStreet Ratings team rates EVERSOURCE ENERGY as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate EVERSOURCE ENERGY (ES) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • ES's revenue growth has slightly outpaced the industry average of 0.8%. Since the same quarter one year prior, revenues slightly increased by 8.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • EVERSOURCE ENERGY reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, EVERSOURCE ENERGY increased its bottom line by earning $2.57 versus $2.48 in the prior year. This year, the market expects an improvement in earnings ($2.85 versus $2.57).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electric Utilities industry. The net income increased by 62.9% when compared to the same quarter one year prior, rising from $127.37 million to $207.51 million.
  • The debt-to-equity ratio is somewhat low, currently at 0.96, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.38 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • You can view the full analysis from the report here: ES

 

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8. PPL Corp. (PPL - Get Report)
Industry: Utilities Non-Telecom/Electric Utilities
Market Cap: $21.7 billion
Year-to-date return: 11.6%

TheStreet Said: TheStreet Ratings team rates PPL CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate PPL CORP (PPL) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity, solid stock price performance, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Electric Utilities industry and the overall market, PPL CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • Compared to where it was trading a year ago, PPL's share price has not changed very much due to (a) the relatively weak year-over-year performance of the overall market, (b) the company's stagnant earnings, and (c) other mixed results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • PPL CORP has improved earnings per share by 8.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, PPL CORP increased its bottom line by earning $2.50 versus $1.69 in the prior year. For the next year, the market is expecting a contraction of 12.0% in earnings ($2.20 versus $2.50).
  • PPL, with its decline in revenue, slightly underperformed the industry average of 0.8%. Since the same quarter one year prior, revenues slightly dropped by 3.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • 48.34% is the gross profit margin for PPL CORP which we consider to be strong. Regardless of PPL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PPL's net profit margin of -42.50% significantly underperformed when compared to the industry average.
  • You can view the full analysis from the report here: PPL

 

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7. Ameren Corp. (AEE - Get Report)
Industry: Utilities Non-Telecom/Multi-Utilities
Market Cap: $10.1 billion
Year-to-date return: 12.2%

TheStreet Said: TheStreet Ratings team rates AMEREN CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate AMEREN CORP (AEE) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations, solid stock price performance and increase in net income. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • 36.12% is the gross profit margin for AMEREN CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 10.70% trails the industry average.
  • Net operating cash flow has increased to $469.00 million or 13.01% when compared to the same quarter last year. Despite an increase in cash flow, AMEREN CORP's cash flow growth rate is still lower than the industry average growth rate of 41.60%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • AMEREN CORP's earnings per share declined by 35.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, AMEREN CORP increased its bottom line by earning $2.41 versus $2.10 in the prior year. This year, the market expects an improvement in earnings ($2.55 versus $2.41).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Multi-Utilities industry average. The net income increased by 0.7% when compared to the same quarter one year prior, going from $149.00 million to $150.00 million.
  • You can view the full analysis from the report here: AEE


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6. Pinnacle West Capital Corp. (PNW - Get Report)
Industry: Utilities Non-Telecom/Electric Utilities
Market Cap: $7 billion
Year-to-date return: 12.7%

TheStreet Said: TheStreet Ratings team rates PINNACLE WEST CAPITAL CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate PINNACLE WEST CAPITAL CORP (PNW) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations, solid stock price performance, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • 39.83% is the gross profit margin for PINNACLE WEST CAPITAL CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 13.79% is above that of the industry average.
  • Net operating cash flow has increased to $250.15 million or 15.85% when compared to the same quarter last year. Despite an increase in cash flow, PINNACLE WEST CAPITAL CORP's average is still marginally south of the industry average growth rate of 22.16%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The debt-to-equity ratio is somewhat low, currently at 0.87, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.22 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • PINNACLE WEST CAPITAL CORP's earnings per share declined by 7.6% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, PINNACLE WEST CAPITAL CORP reported lower earnings of $3.58 versus $3.66 in the prior year. This year, the market expects an improvement in earnings ($3.85 versus $3.58).
  • You can view the full analysis from the report here: PNW

 

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5. Edison International (EIX - Get Report)
Industry: Utilities Non-Telecom/Electric Utilities
Market Cap: $20.1 billion
Year-to-date return: 13.5%

TheStreet Said: TheStreet Ratings team rates EDISON INTERNATIONAL as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

We rate EDISON INTERNATIONAL (EIX) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures, notable return on equity and growth in earnings per share. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Net operating cash flow has significantly increased by 665.71% to $804.00 million when compared to the same quarter last year. In addition, EDISON INTERNATIONAL has also vastly surpassed the industry average cash flow growth rate of 22.16%.
  • The debt-to-equity ratio is somewhat low, currently at 0.97, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.19 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Electric Utilities industry and the overall market on the basis of return on equity, EDISON INTERNATIONAL has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • EDISON INTERNATIONAL has improved earnings per share by 7.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, EDISON INTERNATIONAL increased its bottom line by earning $4.34 versus $2.67 in the prior year. For the next year, the market is expecting a contraction of 12.4% in earnings ($3.80 versus $4.34).
  • You can view the full analysis from the report here: EIX

 

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4. Consolidated Edison Inc. (ED - Get Report)
Industry: Utilities Non-Telecom/Multi-Utilities
Market Cap: $19.2 billion
Year-to-date return: 15.5%

TheStreet Said: TheStreet Ratings team rates CONSOLIDATED EDISON INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate CONSOLIDATED EDISON INC (ED) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income and growth in earnings per share. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Multi-Utilities industry average. The net income increased by 2.8% when compared to the same quarter one year prior, going from $213.00 million to $219.00 million.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • CONSOLIDATED EDISON INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, CONSOLIDATED EDISON INC increased its bottom line by earning $3.71 versus $3.61 in the prior year. This year, the market expects an improvement in earnings ($4.00 versus $3.71).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.5%. Since the same quarter one year prior, revenues slightly dropped by 4.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for CONSOLIDATED EDISON INC is currently lower than what is desirable, coming in at 26.83%. Regardless of ED's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 7.85% trails the industry average.
  • You can view the full analysis from the report here: ED

 

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3. WEC Energy Group Inc. (WEC - Get Report)
Industry: Utilities Non-Telecom/Multi-Utilities
Market Cap: $16.3 billion
Year-to-date return: 16.1%

TheStreet Said: TheStreet Ratings team rates WEC ENERGY GROUP INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate WEC ENERGY GROUP INC (WEC) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • WEC ENERGY GROUP INC's earnings per share declined by 39.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WEC ENERGY GROUP INC increased its bottom line by earning $2.58 versus $2.51 in the prior year. This year, the market expects an improvement in earnings ($2.72 versus $2.58).
  • Net operating cash flow has increased to $386.20 million or 14.87% when compared to the same quarter last year. Despite an increase in cash flow, WEC ENERGY GROUP INC's cash flow growth rate is still lower than the industry average growth rate of 41.60%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.5%. Since the same quarter one year prior, revenues slightly dropped by 5.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • The gross profit margin for WEC ENERGY GROUP INC is currently lower than what is desirable, coming in at 33.90%. Regardless of WEC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 8.16% trails the industry average.
  • You can view the full analysis from the report here: WEC

 

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2. AGL Resources Inc. (GAS)
Industry: Utilities Non-Telecom/Gas Utilities
Market Cap: $7.3 billion
Year-to-date return: 31.1%

TheStreet Said: TheStreet Ratings team rates AGL RESOURCES INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate AGL RESOURCES INC (GAS) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has increased to $365.00 million or 13.35% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 1.52%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • GAS, with its decline in revenue, slightly underperformed the industry average of 20.1%. Since the same quarter one year prior, revenues fell by 24.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Gas Utilities industry average, but is less than that of the S&P 500. The net income has significantly decreased by 27.6% when compared to the same quarter one year ago, falling from $58.00 million to $42.00 million.
  • AGL RESOURCES INC's earnings per share declined by 27.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, AGL RESOURCES INC increased its bottom line by earning $4.72 versus $2.45 in the prior year. For the next year, the market is expecting a contraction of 37.1% in earnings ($2.97 versus $4.72).
  • You can view the full analysis from the report here: GAS

 

TE Chart TE data by YCharts

1. Teco Energy Inc. (TE)
Industry: Utilities Non-Telecom/Multi-Utilities
Market Cap: $6.1 billion
Year-to-date return: 48.7%

TheStreet Said: TheStreet Ratings team rates TECO ENERGY INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate TECO ENERGY INC (TE) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, solid stock price performance, reasonable valuation levels and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 12.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 102.15% to $149.80 million when compared to the same quarter last year. In addition, TECO ENERGY INC has also vastly surpassed the industry average cash flow growth rate of 41.60%.
  • TECO ENERGY INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TECO ENERGY INC increased its bottom line by earning $0.92 versus $0.88 in the prior year. This year, the market expects an improvement in earnings ($1.10 versus $0.92).
  • Compared to its closing price of one year ago, TE's share price has jumped by 54.75%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • You can view the full analysis from the report here: TE