Utility stocks are not usually the kinds of investments that get people excited. These businesses are steady, boring, and built for patience. However, sometimes a utility makes a move that changes the entire growth conversation. OGE Energy (OGE) just made that kind of move.
Based in Oklahoma City, Oklahoma, the company announced on April 30 that its operating subsidiary, OG&E, will power three new data centers for Alphabet’s (GOOGL) Google. These data centers will be in Muskogee, Oklahoma and Stillwater, Oklahoma.
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This deal is structured with strong customer protections and long-term contracts — and it comes right on the heels of a solid first-quarter earnings report that confirmed management’s confidence in the year ahead. Here’s what investors should know about OGE stock now.
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Why Utilities Are Winning the AI Power Race
The artificial intelligence (AI) buildout requires enormous amounts of electricity as data centers require reliable, affordable power delivered at scale. That reliable power is what OG&E has been quietly building for years, and its rates are “some of the lowest rates in the country” according to CEO and President Sean Trauschke.
Oklahoma residential electric rates sit 19% below the regional average and 34% below the national average. Over the past decade, electricity demand across the company’s system has grown by 25%, while residential rate increases have run below inflation. That combination of low cost and growing demand is a compelling pitch to companies like Google, which need to lock in long-term, predictable energy costs for enormous facilities.
Trauschke put it plainly on the company’s Q1 2026 earnings call: “We continue to believe our in-state pricing is a meaningful advantage in driving new business that we will protect.”
What Does the Google Deal Mean for OGE Stock?
The terms of this agreement are worth understanding, as they are structured differently from those of a standard utility contract. Google will pay 100% of the costs to connect all three data centers to the grid. It will also cover “all contracted costs regardless of the company’s energy use.” Additionally, Google is bringing to the table 600 megawatts of nameplate solar capacity from two solar facilities currently under construction. This structure protects existing ratepayers, which is what state regulators and legislators in Oklahoma have been pushing for.
Trauschke called it a model for how future large-load partnerships should work. “This unique agreement is a model for future data center partnerships and forms the basis for a new large-load tariff that OG&E will submit in the coming weeks,” he said. The CEO added that the deal protects current customers from bearing costs tied to growing demand.
The agreement still needs approval from the Oklahoma Corporation Commission. The company expects to file in the coming days.
A Strong Performance in Q1
For Q1 2026, consolidated earnings came in at $0.24 per diluted share, down from $0.31 in the same period last year, primarily due to milder weather. However, management reaffirmed full-year guidance of $2.43 per share, with a range of $2.38 to $2.48. According to Trauschke, Q1 typically represents only about 10% of OGE’s annual earnings, so the weather-related softness is not alarming.
Customer growth sat just under 1% for the period, and load growth over the past five years is at approximately 24%. CFO Chuck Walworth confirmed the company targets earnings growth in the 5% to 7% range, pointing toward the upper half of that range through the next few years.
The Google deal, an upcoming large battery storage project called Frontier Energy Storage, and a significant new transmission line opportunity collectively extend OGE’s growth runway beyond the current planning period. “Catalysts are out there to extend that expectation,” Walworth said on the earnings call.
Moody’s took notice, too. It recently revised OGE Energy’s credit outlook from negative to stable, citing a constructive regulatory framework and strengthened balance sheet.
What Do Analysts Think of OGE Stock?
For investors looking for a utility with a real near-term catalyst and a long runway of demand-driven growth, OGE stock is worth putting on the radar right now.
Analysts forecast OGE stock to expand adjusted earnings from $2.32 per share in 2025 to $3.24 per share in 2030. If the utility stock is priced at 17.3 times forward earnings, which is similar to its 10-year average, it could surge 17% from current levels over the next four years.
Out of the 13 analysts covering OGE stock, four recommend a “Strong Buy” rating while nine recommend a “Hold,” making for a consensus “Moderate Buy” rating. The average price target is $50.59, implying potential upside of 6% from current levels.
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On the date of publication, Aditya Raghunath did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
