Roger S. Conrad needs no introduction to individual and professional investors, many of whom have profited from his decades of experience uncovering the best dividend-paying stocks for accumulating sustainable wealth.
Roger built his reputation with Utility Forecaster, a publication he founded more than 20 years ago that The Hulbert Financial Digest routinely ranked as one of the best investment newsletters. He’s also a sought-after expert on master limited partnerships (MLP) and former Canadian royalty trusts.
In April 2013, Roger reunited with his long-time friend and colleague, Elliott Gue, becoming co-editor of Energy & Income Advisor, a semimonthly online newsletter that’s dedicated to uncovering the most profitable opportunities in the energy sector.
Although the masthead may have changed, readers can count on Roger to deliver the same high-quality analysis and rational assessment of the best dividend-paying utilities, MLPs and dividend-paying Canadian energy names.
The Federal Reserve is getting serious about reining in inflation. And the kind of big money that never rests for long has apparently decided US utility stocks are an ideal haven.
The happy result: After lagging the past couple years, the Dow Jones Utility Average has pushed out to a 10 percent year-to-date return. That’s even as the S&P 500 has retreated -5.5 percent and the Nasdaq 100 is down -12 percent.
In the December 2021 feature article, I noted the S&P Telecoms Index traded at a bear market valuation 9.4 times earnings, excluding a handful of technology names like Alphabet Inc (NSDQ: GOOGL). If anything, investors’ gloomy consensus on the sector has thickened since, with every communications company but one in our coverage universe losing more ground.
First off, let’s dispense once and for all with the fallacy that rising interest rates are always a bad thing for dividend paying stocks.
A big increase in borrowing costs can certainly derail earnings and dividends of highly leveraged companies. And the Federal Energy Regulatory Commission recently cut PG&E Corp’s (NYSE: PCG) allowed return on equity for transmission to 9.26 percent, meaning there’s no guarantee regulators will allow returns to keep pace with rising interest rates.
After briefly rising over 1,000 for the first time, the Dow Jones Utility Average is in the black this year. That means essential service companies, including big communications stocks, are outperforming pretty much everything this side of oil and gas.
Electric, gas, energy infrastructure, water and communications service providers are the kind of substantial, reliable, dividend paying companies investors like to hold in turbulent times. And early 2022 certainly qualifies, with the highest inflation in 40-plus years, a diminished but lingering pandemic, continuing supply chain disruption and now a full-on war.
Russia’s invasion of Ukraine and the unexpectedly severe global reaction to it have understandably triggered mass selling of any company with perceived exposure. Among the damaged is Aggressive Holding Enel SpA (Italy: ENEL, OTC: ENLAY).
Roger's favorite utilities for investors seeking superior price appreciation by taking calculated risks.
Harness the tried and true wealth-building power of rising dividends.
Nothing compounds wealth like reinvesting a rising stream of dividends.
Warning: Falling Dividends.
Roger's current take and vital statistics on more than 200 essential-services stocks.