Only two Portfolio holdings have yet to turn in earnings this reporting season. Aggressive Holding ENEL SPA (Italy: ENEL, OTC: ENLAY) will unveil its fourth quarter 2013 numbers on March 11. Conservative Holding Piedmont Natural Gas (NYSE: PNY) releases its first quarter fiscal 2014 results on March 7.
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.
The Conrad’s Utility Investor Portfolios officially launched on July 31, 2013. Since that time, the Dow Jones Utility Average is off -2.3 percent, including dividends paid.
My Aggressive Income Portfolio is up by 9.3 percent, while the Conservative Income Portfolio has returned 3.3 percent.
Will Santa Claus visit utility stock investors this year? The sector was out of the gate quickly to start the fourth quarter of 2013. But concerns about the “tapering” off of Federal Reserve bond buying quickly slowed things down.
Will the Federal Reserve really “taper” off its easy money policy? The stock market has already reacted, with dividend-paying stocks leading the selling: The Dow Jones Utility Average is now flat for the fourth quarter, after being up better than 5 percent through mid-November.
Barring a real financial earthquake, this will be the ninth year of rising interest rates since 1992.
2013 will also be the eighth of those nine that utilities and other dividend paying stocks finished in the black. The only exception was 1994, when deregulation fears upended electricity and communications.
Utilities also rose eight years when rates fell. All their biggest declines, however, were during years of falling interest rates, particularly 2008.
Utility stock prices ultimately reflect the health of underlying companies. Stocks of financially healthy companies with growing dividends always move higher. But when an economic calamity brings interest rates lower quickly, they can drop in a hurry.
Roger's favorite utilities for investors seeking superior price appreciation by taking calculated risks.
Harness the tried and true wealth-building power of rising dividends.
Nothing compounds wealth like reinvesting a rising stream of dividends.
Warning: Falling Dividends.
Roger's current take and vital statistics on more than 200 essential-services stocks.