Investing Topics: Income Investing

Not every buy and hold investor has the savvy and steady temperament to be as successful as Warren Buffett. Similarly, not every short seller is insightful and nimble enough to match Jim Chanos’ storied success.

No US utility is better positioned to profit from America’s energy boom than Entergy Corp (NYSE: ETR). The company’s six electric utility units own and operate 22 gigawatts of power plants in Arkansas, Louisiana, Mississippi and Texas.

Buying stocks of strong companies at the lowest possible prices: That’s been my primary strategy thus far for the Conrad’s Utility Investor Portfolios.

This month, I’m adding two stocks to the Conservative Holdings.

With large financial institutions and exchange-traded funds (ETFs) dominating daily trading, markets are as volatile as ever.

Fortunately, the key to success in utilities and essential services is the same as it’s been for more than a century: Spotting where investment will earn a fair return, and following the money to a rising stream of dividends.

Last November, I advised income investors to favor AT&T (NYSE: T) a traditional dividend paying stock, over shares of its iPhone partner Apple Inc (NSDQ: AAPL).

Fourth quarter and full-year earnings normally dominate the news this time of year. And rightly so: They’re what ultimately shape shareholder returns.

This week, FirstEnergy Corp (NYSE: FE) announced the first electric utility dividend cut for 2014. Fortunately, it’s likely to be the last as well.

Count me a “distech” skeptic. So-called disruptive technologies never fail to grab headlines. Those who bet on them, however, usually wind up with empty wallets.

Kinder Morgan Energy Partners LP (NYSE: KMP) has come under fire for its tight distribution coverage and concerns that the blue-chip MLP’s size makes it difficult to grow cash flow. The burdensome incentive distribution rights that the partnership pays to its general partner, Kinder Morgan Inc. are another cause for concern.

Wall Street’s January ritual is to roll out “new” investment strategies. This year, fund manager Bill Gross has proclaimed the end of a 30-year bull market for bonds. So it’s no great surprise income advisors further down the food chain are pushing investors to adjust portfolios for higher interest rates.