The Environmental Protection Agency's ongoing crackdown on carbon dioxide emissions from coal-fired power plants continues to dominate the headlines. But investors shouldn't overlook the importance of utility-regulator relations at the state and local level.
Dominion Resources (NYSE: D) shares hit an all-time high this week. The catalyst: A proposed spin off of the company’s natural gas assets into a master limited partnership (MLP), with an initial public offering in the second quarter of 2014.
August was a down month for utilities and other essential services companies—likewise the broad stock market. That continues a trend beginning in late April, when fears first stirred of an end to Federal Reserve easing.
Since then, the Fed has not changed policy. But the markets have acted as though much higher interest rates are a done deal. The yield on the benchmark 10-year Treasury Note yield has nearly doubled. And expectations are we’ll see it at 4 to 5 percent, as the precursor to a dramatic, across the board rise in rates.
Big picture themes always grab investing headlines. Success, however, flows from knowing what’s up with individual companies.
Regulated water utilities, for example, are on their face the very simplest and uniform of businesses. Yet so far in 2013, returns from the 10 companies I track in the Utility Report Card have ranged from a 26 percent gain to barely breaking even.
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.
Utility stocks might be due for a pullback, but the risks that rising interest rates pose to the sector are overblown.
Roger's favorite utilities for investors seeking superior price appreciation by taking calculated risks.
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Warning: Falling Dividends.
Roger's current take and vital statistics on more than 200 essential-services stocks.