Roger S. Conrad

Last November, I advised income investors to favor AT&T (NYSE: T) a traditional dividend paying stock, over shares of its iPhone partner Apple Inc (NSDQ: AAPL).

Fourth quarter and full-year earnings normally dominate the news this time of year. And rightly so: They’re what ultimately shape shareholder returns.

This week, FirstEnergy Corp (NYSE: FE) announced the first electric utility dividend cut for 2014. Fortunately, it’s likely to be the last as well.

Shares of Just Energy Group plunged 7.6 percent today after the firm announced plans to issue up to US$150 million in convertible bonds.

Verizon Communications (NYSE: VZ) posted solid fourth-quarter earnings yesterday, demonstrating once again why the stock is a foundational holding for income-seeking investors.

Count me a “distech” skeptic. So-called disruptive technologies never fail to grab headlines. Those who bet on them, however, usually wind up with empty wallets.

Kinder Morgan Energy Partners LP (NYSE: KMP) has come under fire for its tight distribution coverage and concerns that the blue-chip MLP’s size makes it difficult to grow cash flow. The burdensome incentive distribution rights that the partnership pays to its general partner, Kinder Morgan Inc. are another cause for concern.

Wall Street’s January ritual is to roll out “new” investment strategies. This year, fund manager Bill Gross has proclaimed the end of a 30-year bull market for bonds. So it’s no great surprise income advisors further down the food chain are pushing investors to adjust portfolios for higher interest rates.

Nothing destroys shareholder value like a dividend cut. Investors should steer clear of these names.

Where January leads, the rest of the year follows: That Wall Street adage has generally held up for most stocks over the years.

But it definitely has not for utilities—they’ve received a false signal 10 times in the past 30 years.

The keys to 2014 are ensuring the health and growth of the stocks you own, and buying selected bargains. These appear when investors let emotions get the better of them, or follow strategies based on false premises.

The most deadly conventional wisdom last year is still very much in play now: Selling utilities and other dividend-paying stocks for fear of rising interest rates.

As it turned out, rates did rise a lot in 2013, with the 10-year US Treasury note yield soaring more than 70 percent. But the Dow Jones Utility Average, Alerian MLP Index and S&P Telecom Service Index all finished 2013 with double-digit total returns.

That’s exactly what they did in 2009, the last time the 10-year Treasury note yield rose by better than 70 percent. In fact, the trio’s worst year by far since 1984 was 2008, a year of sharply falling interest rates.