Elections 2018: Utilities Fare Well But With Challenges

Elections have consequences. And few companies are as potentially exposed as providers of essential services like electricity, heat, water and communications.

This year’s voting was no exception. Typically, mid-term elections are ill-attended affairs where the more energized party ambushes the other. This time, however, both Democrats and Republicans came out to play with the highest turnout for a non-presidential election year since 1966.

The counting continues for a lot of close races. But the big picture takeaway from this election is pretty clear. Mainly, a blue wave washed out the existing political order in much of the US, while leaving incumbents high and dry in other places.

The result is investors are left with a much more complicated post-election picture task than usual. That means asking the following:

• Where did the changes occur?
• What do these changes mean in terms of practical policy?
• Which companies are potentially affected?
• Can management teams turn the changes to their favor and dodge the emerging risks?