Investing Topics: Latin America

After two consecutive winning months, it’s hard to believe utility stocks had so many detractors to start 2014. And it’s even more difficult to find anyone who will own up to being bearish then or now.

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

When AES Corp (NYSE: AES) started doing business in the 1990s, it had a simple philosophy: Scour the globe for growing electricity demand and execute projects to meet it.

AT&T Inc (NYSE: T) was the only Conrad’s Utility Investor Portfolio pick to report numbers last week. Takeaway one is quite positive: The results followed closely those of arch-rival and co-Big Two US communications company Verizon Communications (NYSE: VZ).

In the October issue, I added four stocks to the Conrad’s Utility Investor model portfolios.

Stocks around the globe are running into trouble in this slowing economic environment, It's been especially tough on companies that rely on emerging markets for their growth.

Telefonica’s woes can be squarely blamed on aggressive global expansion right up to the great crash of 2008. Revenue growth in Latin America has offset shrinking in Spain and elsewhere in Europe but the Continent’s credit crunch has forced the company to sell assets to reduce its debt load, even as its credit rating has been cut. But things are looking up.

The book is now almost closed on calendar first quarter 2013 earnings for my 45 Target List stocks. Utilities and other essential services stocks had a big run to start 2013. As a result, several target list companies have surged well beyond what I’d pay for them. Have a look at my current advice.