The flow of mergers of entire utility companies has dried up, relative to the heady pace of a few years ago. But management teams are still finding plenty of assets to buy and sell.
The strong US dollar, worries about slowing global growth and disruption from uncertain politics and trade policy: That trio of entrenched trends continues to fuel investor appetites to “buy American,” dividend-paying stocks of US-based companies that generate all or mostly all of their sales within our borders.
Wall Street consensus is the U.S. Federal Reserve will officially close the book on three-and-a-half years of monetary tightening next week, by cutting its benchmark Federal Funds interest rate. But our focus needs to be on earnings and guidance, not headlines.
It seems California Governor Gavin Newsom will not preside over a utility collapse as former Governor Gray Davis did almost 20 years ago, thanks to a legislative fix to state utilities’ bottomless liability for wildfire damages.
Almost 20 years ago, dysfunctional rules for California’s unregulated power market drove the state’s two biggest electric utilities into bankruptcy and impacted the entire sector. This year, the "inverse condemnation" rule has triggered one bankruptcy filing and may push the state's other electric utilities' ratings toward junk.
While much of the rebound in our CUI Conservative Income Portfolio and bond holdings has been due to reduced economic fears, the fact these companies have demonstrated strength in operating results has no doubt helped prices recover over the past four months.
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Roger's current take and vital statistics on more than 200 essential-services stocks.