Utility Roundup

Utilities and other providers of essential services are proven survivors of even the worst market debacles. As the 2008 market crash showed, the sector takes hits with the rest of the stock market.

In the October issue, I added four stocks to the Conrad’s Utility Investor model portfolios.

There was plenty to talk about this week from telecom to utilities to energy MLPs.

Here’s the news from our Portfolio holdings over the past week. 

Utilities pay some of the safest and highest dividends on Wall Street. But they’re stocks, not substitute investments for bonds.

Those who’ve tried to treat them like bonds have consistently underestimated their returns in bull markets, as well as downside in bear markets. Similarly, those who’ve bought when interest rates were falling and sold when rates have risen have routinely paid too much and sold too cheaply. And occasionally as in 2008, they’ve had their heads handed to them.

There weren't any big surprises in our Focus List earnings reports this quarter, which is the way we like it. But there are a lot of bargains in all three portfolios that you can move into now. The story of essential service stocks is just beginning.

Utilities and essential services stocks are known for their long-run stability—both all-weather business strength and low share price volatility. But even they pale before the unmatched reliability of utility bonds.

I had a chance to sit down with Conrad’s Utility Investor Managing Editor Gregg Early and we had a wide-ranging conversation about some of the big issues in the essential services industry today as well some of the hot topics of the day.

The book is now almost closed on calendar first quarter 2013 earnings for my 45 Target List stocks. Utilities and other essential services stocks had a big run to start 2013. As a result, several target list companies have surged well beyond what I’d pay for them. Have a look at my current advice.