Most CUI Portfolio stocks have run in place since the April issue. But the past month has been far from uneventful, with 34 of 38 recommended companies reporting their first results and guidance updates since COVID-19 fallout hit the scene.
In investing, it’s common for good years to follow good years, and great years often follow average or poor ones. But historically great years like what we’ve just enjoyed at Conrad’s Utility Investor rarely if ever come back to back.
US/China trade deal optimism has gained steam this month. That’s pushed up the yield on the 10-year Treasury bond to its highest level since late July. And the result has been a mini-sector rotation out of many dividend-paying stocks.
A record two-dozen CUI Portfolio companies currently trade above my recommended entry points. That’s to be expected in an environment where investors are seeking safety and yield. And utility stocks offer the added bonus of earning most or all revenue in the US while realizing strong, reliable earnings growth from renewable energy, 5-G and other transforming technologies.
When this issue went to post, not every company in our Utility Report Card coverage universe or model portfolios had released its second quarter numbers. But there’s enough available information to discern several key takeaways.
First, even in these essential service businesses, there’s evidence the US economy has lost some steam. One place that’s shown up is industrial sales of the country’s largest electric utilities.
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Roger's current take and vital statistics on more than 200 essential-services stocks.