Roger S. Conrad

The Trump administration has pushed several policies that could shake up domestic electricity markets. Of these initiatives, the Dept of Energy’s proposed subsidies for merchant coal-fired power plants and nuclear reactors would radically change the existing market dynamics. We evaluate the investment risks and opportunities created by these shifts.

Company-specific developments warrant higher buy targets for a trio of our Portfolio holdings.

A blockbuster acquisition could put this European water and environmental services company on the path to dividend growth.

This large-cap utility offers exposure to multiple upside drivers and trades at a reasonable valuation.

Although third-quarter earnings season hasn't hit yet, recent developments have landed four companies on the Endangered Dividends List. The latest additions include two former members that had escaped after slashing their payouts.

How utilities respond to storm-related outages can have important implications for regulatory relations.

Massive distribution cuts from the likes of Plains All-American Pipeline LP have severely damaged midstream master limited partnerships' (MLP) reputation among income investors. But our favorite MLPs trade at favorable valuations and offer exposure to compelling volumetric growth stories.

September is often the cruelest month for the stock market, including utilities. This year, however, nothing has broken the sector’s upward momentum, including devastating hurricanes, uncertainty surrounding tax reform, and a pending trade case that could slow the adoption of solar power in the US. We’re not complaining; our Portfolio holdings continue to benefit from this momentum. But the higher bar of expectations that comes with these lofty valuations increases the potential for disappointment. This month’s update to the Utility Report Card uses our proprietary Conrad’s Utility Investor Value Index to compare current valuations to previous peaks in the run-up to the 2000-01 and 2008-09 meltdowns. The biggest takeaway from this exercise is that many utility stocks trade at valuations that exceed these highs. Some of this disconnect between fundamentals and valuations likely stems from the growing popularity of passive investment strategies, a phenomenon we explore at length in the feature article. Nevertheless, we continue to find value in our coverage universe.

Macroeconomic developments and moves in the broader market matter when you buy and hold individual stocks. But if you have chosen well, paid a reasonable price, and can keep your emotions in check, even a 2008-style collapse will only delay, not derail, your wealth-building efforts.

The Dow Jones Utility Average hit a new all-time high this month, but pockets of value still exist in our coverage universe.