Dominion Energy, Inc. (D): A Bull Case Theory

We came across a bullish thesis on Dominion Energy, Inc.  on Disruptive analytics’s Substack by Magnus Ofstad. In this article, we will summarize the bulls’ thesis on D. Dominion Energy, Inc. 's share was trading at $61.90 as of August 22^nd. D’s trailing and forward P/E were 20.56 and 18.25 respectively according to Yahoo Finance.

Dominion Energy (D) reported strong Q2 2025 results, with GAAP net income rising 38% YoY to $760 million, or $0.88 per share, and operating earnings of $0.75 per share beating expectations on 9% revenue growth to $3.81 billion. Its regulated utility segments in Virginia and South Carolina performed steadily, supported by customer growth, favorable rate cases, and enhanced returns. The Coastal Virginia Offshore Wind project remains on track, underscoring D’s pivot toward clean, regulated energy assets.

Beyond utilities, the company’s unique positioning in Virginia’s “Data Center Alley” makes it especially compelling. This region, home to the highest concentration of data centers globally, is seeing rapid expansion fueled by demand for cloud computing, AI, and crypto-related infrastructure. As of late 2024, D had nearly 40 gigawatts of data center capacity contracted, with plans to double in the coming years. To capture this growth, D is investing heavily in transmission infrastructure, including high-voltage lines and substations tailored to hyperscale data centers, while regulatory approvals and rate increases in Virginia are enabling these capital projects.

Management guides for mid-single-digit earnings growth through the decade, but surging data center and industrial demand in Virginia and North Carolina could push growth beyond expectations. Leverage remains elevated at ~5x EBITDA, but this is set to improve as the Coastal Virginia Offshore Wind project begins generating revenue next year, boosting cash flow and supporting debt reduction. With strong utility fundamentals, unique exposure to data center-driven energy demand, and near-term catalysts from renewables, D offers a compelling investment with attractive long-term upside.

Previously we covered a bullish thesis on Quanta Services, Inc. (PWR) by Bulls On Parade in May 2025, which highlighted its role in grid modernization, renewable integration, and data center infrastructure buildout. The company’s stock price has appreciated approximately by 29.91% since our coverage. This is because AI-driven electricity demand accelerated. The thesis still stands as infrastructure investments remain robust. Magnus Ofstad shares a similar view but emphasizes Dominion Energy’s positioning in Virginia’s “Data Center Alley.”

Dominion Energy, Inc.  is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 46 hedge fund portfolios held D at the end of the first quarter which was 39 in the previous quarter. While we acknowledge the potential of D as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.