Investing Topics: Investment Strategy

Writing under the famous pen name Mark Twain, Samuel Clemens coined the phrase “history doesn’t repeat itself, but it often rhymes.”

I’m not the first to apply that bit of country wisdom to investing. But it’s always worth revisiting in the aftermath of extraordinary market events.

Gas companies strengthened their case during pandemic-wracked 2020 by demonstrating extremely stable economics, paying generous dividends backed by ultra-secure and growing cash flows, and still remaining small enough to have perennial takeover appeal. Those strengths promise to make natural gas distribution a hot commodity again in 2021.

At first glance, MDU Resources (NYSE:MDU) shows a fairly discouraging investment profile. But there are three very good reasons to expect much better in the next 12 months.

Strong regulated utilities combined with long-term contracted renewable energy generation: That’s the NextEra Energy (NYSE: NEE) business model. And not only does the formula work well, it’s become quite popular with investors.

Chronic share underperformance, weak Q2 operating results and still-heavy debt raise the question - is it time to sell AT&T (NYSE: T)?

From shuttered stores and offices to surging unpaid rents, US landlords have suffered a body blow this year. And there’s more turbulence ahead, from short-term cash shortfalls to big changes in tenant preferences. But American property is hardly down for the count.

Total SA's (Paris: FP, NYSE: TOT) first-quarter results are a warning to those who would bet against the future of super majors. The environment is changing, but the business model is alive and well.

With the virus still spreading and shutdowns continuing, forecasting COVID-19’s eventual damage to human health and the global economy is still a matter of conjecture, making it difficult for management teams to set guidance for the rest of 2020.

However, Q1 numbers and guidance, to be released over the next several weeks, will be absolutely critical to making good decisions, particularly where dividend safety is concerned.

I typically update advice in the Conrad’s Utility Investor website tables with the regular monthly issues. For urgent advice I send Alerts. If there’s a theme to expand on, I post an Income Insights or Utility Roundup.

These “interesting times,” however, require an update for the five tables under the Portfolios tab.

Despite the indiscriminate selling of the past few days, these two companies are well-positioned to weather this latest phase of the midstream stress test. Here's why.