Two Utilities Stocks That May Experience Decline in Q3: Talen Energy and Hawaiian Electric Industries

Two utilities stocks in the utilities sector, Talen Energy Corp (TLN) and Hawaiian Electric Industries Inc (HE), are showing warning signs for investors who value momentum. Talen Energy's stock jumped 6% over the past month and has a 52-week high of $394.07, with an RSI value of 72.2. Hawaiian Electric's stock gained 14% over the past month and has a 52-week high of $13.18, with an RSI value of 74.3. Both stocks have high momentum scores but low value scores.

Two utilities stocks in the sector, Talen Energy Corp (TLN) and Hawaiian Electric Industries Inc (HE), have shown significant momentum over the past month, raising caution for investors focused on value. Talen Energy's stock has surged 6% over the past month and reached a 52-week high of $394.07, with a Relative Strength Index (RSI) value of 72.2. Similarly, Hawaiian Electric's stock has gained 14% over the same period, reaching a 52-week high of $13.18, with an RSI value of 74.3. Both stocks exhibit high momentum scores but low value scores, prompting investors to exercise caution.

Talen Energy Corp (TLN)

Talen Energy's recent surge is attributed to a confluence of factors, including nuclear innovation, data center demand, and regulatory tailwinds. The stock's 6.09% intraday increase coincides with Aalo Atomics' $10-MWe modular nuclear reactor project at Idaho National Laboratory, set to achieve cold criticality by July 2026 [1]. Additionally, regulatory clarity around DOE’s nuclear pilot program and data center partnership announcements are near-term triggers that could sustain Talen Energy's momentum.

However, the stock's high RSI value indicates overbought conditions, suggesting potential reversal. Key support and resistance levels are at $375.48 and $392.85, respectively, with the 52-week high at $394.07 serving as a critical psychological level. Aggressive bulls might consider buying call options with strikes around $377.50, while conservative traders could target options with strikes around $380.00.

Hawaiian Electric Industries Inc (HE)

Hawaiian Electric's stock has gained 14% over the past month, reaching a 52-week high of $13.18. The utilities provider reported a loss in its most recent earnings report, with earnings per share at $0.20, missing estimates by $0.04. Despite the loss, institutional investors have adjusted their positions, with T. Rowe Price Investment Management Inc. reducing its stake by 8.5% and other investors increasing their holdings [3]. The stock's high momentum score, coupled with a low value score, suggests that investors should monitor the company's fundamentals closely.

Conclusion

Both Talen Energy and Hawaiian Electric have shown strong momentum over the past month, with high RSI values indicating overbought conditions. While Talen Energy's surge is driven by nuclear innovation and regulatory tailwinds, Hawaiian Electric's gain is attributed to institutional investor adjustments. However, the low value scores and high momentum scores suggest that investors should exercise caution and monitor the companies' fundamentals closely. As always, it is essential to conduct thorough research and consider both qualitative and quantitative factors when making investment decisions.

References

[1] https://www.ainvest.com/news/talen-energy-surged-5-95-hidden-catalysts-ignite-powerhouse-2508/
[2] https://finance.yahoo.com/news/bofa-maintains-buy-talen-energy-050146270.html
[3] https://www.marketbeat.com/instant-alerts/filing-t-rowe-price-investment-management-inc-has-11847-million-stock-position-in-hawaiian-electric-industries-inc-he-2025-08-22/