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.
When you’re a long-term investor, momentum isn’t always going to flow your way. And when it’s against you—whatever the reason—it can be intensely frustrating, no matter how much in dividends you’re collecting. The greatest danger is it’s all too easy to conflate stock market weakness with a truly unraveling business. You may bail out prematurely from a company that’s only undergoing a temporary setback. Or alternatively, you might hold onto a stock that’s only just beginning its descent, as declining sales lead to dividend cuts and worse.
When a company cuts its dividend, its share price usually craters. The exception is if the reduction is part of a larger strategic move that makes sense. That’s the case for Aggressive Holding MDU Resources (NYSE: MDU), which reduced its quarterly dividend for payment in October by -43.8 percent to 12.5 cents per share.
In the 120 years plus since electricity, heating and water became essential services, not one regulated operating utility has ever gone out of business. That includes companies forced to declare bankruptcy, most recently California’s PG&E Corp (NYSE: PCG) The same can’t be said for communications. Since the Telecom Act of 1996 ended local phone monopolies, literally hundreds of companies have appeared only to vanish in a few years. And several in my Utility Report Card coverage universe are flirting with some form of debt restructuring now, including Altice USA (NYSE: ATUS), DISH Network Corp (NSDQ: DISH) and Lumen Technologies (NYSE: LUMN).
The Dow Jones Utility Average finished 2022 more than 20 percentage points ahead of the S&P 500. So far this year, however, utilities are lagging by roughly the same amount.
The S&P 500’s gains are thanks to the continuing surge in big technology stocks, which led by Apple Inc (NSDQ: AAPL) at 7.673 percent are a record 37 percent of the benchmark index. Meanwhile, the DJUA at -4 percent year to date is tracking weakness in dividend paying stocks—as well as sectors considered “cyclical” and vulnerable to Federal Reserve rate increases and still-elevated recession risk.
Not once since its November 1999 IPO has Brookfield Renewable Partners (TSX: BEP-U, NYSE: BEP) ever cut its dividend. Nor has the company missed an annual increase since 2009—when the rate was held flat following Canada’s death sentence for income trusts.
Last year, Southwest Gas Holdings (NYSE: SWX) shares soared above $90, my “consider taking profits” price listed in the “Portfolio Holdings Trading Above Target” table. We would have done better selling it all.
It’s been mostly more of the same for investment markets this past month, just as has been the case for most of this year.
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.
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Warning: Falling Dividends.
Roger's current take and vital statistics on more than 200 essential-services stocks.