Roger S. Conrad

With many utility stocks trading at record highs, even buy-and-hold investors should consider taking some profits off the table.

The price of an annual subscription to Conrad's Utility Investor will increase to $199 per year in 24 hours. Current subscribers will continue to renew at their current discounted rate.

With the Dow Jones Utilities Average trading at an elevated valuation, investors shouldn't be afraid to take some profits off the table in their big winners.

There's more pain to come for many high-yielding exploration and production stocks.

The Dow Jones Utilities Average returned 30.7 percent in 2014—the index’s best showing since 2000. Telecoms, energy and most international stocks posted far less impressive results. Our Conservative Income Portfolio and Aggressive Income Portfolio posted solid gains last year, though uneven returns among individual holdings call for some tactical decisions in the new year. The Jan. 5 Utility Roundup included results for each of the 43 companies that graced our Portfolios in 2014. Returns range from a 20 percent paper loss in MDU Resources (NYSE: MDU) to an average gain of almost 50 percent on six positions we sold during the year. A year ago, conventional wisdom assumed that regulated utility stocks would get whacked by the Federal Reserve raising interest rates and lost sales to SolarCity Corp (NSDQ: SCTY) and other proponents of distributed solar power. This expectation enabled us to pick up some of our biggest winners last year on the cheap. Utility stocks find themselves in vogue this year. Exelon Corp (NYSE: EXC), for example, gained more than 40 percent in 2014 and now garners seven buy ratings from Wall Street analysts—up from zero at the year’s outset. But with the Dow Jones Utilities Average trading at almost 19 times earnings, good values are hard to find. Against this backdrop, the Utility Report Card includes more Hold and Sell ratings than at any other time since 2009. Bottom Line: In this late-stage bull market, it’s more critical than ever to stick to stocks that trade below our buy targets to avoid overpaying or taking on too much downside risk. Fortunately, savvy investors can load up on bargains in other essential-services industries...

Plummeting prices for crude oil and natural gas liquids have depressed the prices of this Aggressive Income Portfolio holding.

Our model Portfolios outperformed once again in 2014. Rather than rest on our laurels, we kick the tires on our winners and losers to determine whether they’re worth holding for 2015.

Four companies on our Endangered Dividends List cut their payouts last month, while one regional telecom escapes from the list after announcing a surprise dividend increase.

The trends that shaped returns for essential-services stocks in 2014 should remain in play this year. Here’s how to profit.

Long-term contracts and a solid backlog of opportunities make this Canadian power producer a winner.