• Twitter
Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors

Executive Summary

Utility Earnings and the Burden of High Expectations

By Roger S. Conrad on Nov. 11, 2019

It was another strong quarter for the nearly 200 essential service companies in our Utility Report Card coverage universe. Of the 95 percent or so reporting so far, only a handful of small telecoms failed to demonstrate underlying business strength.

My number one rule in any environment is to avoid stocks and bonds of companies with weakening underlying businesses. If things are going poorly now, how bad will they get when the economy really slows and/or the cost of capital rises?

Aggressive Holding Suburban Propane Partners (NYSE: SPH) has yet to report its fiscal fourth quarter. But each of the 38 other CUI Portfolio recommendations reported numbers that either met or beat management’s previous guidance.

Certainly not all the details were favorable. Even the best run electric and gas utilities saw pressure from global trade tensions on their sales to industrial customers. Weather and storm activity wreaked their usual havoc. And our communications companies faced accelerated declines in legacy phone and pay television businesses.

But overall, these results paint a picture of financially strong and growing companies ready for what comes next in the global economy and stock markets. That’s the best possible reason for holding onto them, while harvest or (better) reinvesting their rising dividends.

Strong numbers and positive guidance earned increased recommended buy prices for several favored stocks. Those include Conservative Focus stock ONEOK Inc (NYSE: OKE) and Aggressive Focus Atlantica Yield (NSDQ: AY).

For the Portfolio stocks trading above recommended entry points, however, the best policy is patience. That’s to wait on a dip to the buy-up-to prices we show in our Portfolio tables and the Utility Report Card. Or, if you’re particularly aggressive, place buy limit orders at the “Dream Buy” prices I highlight in the Portfolio section.

It’s true many stocks haven’t traded at bargains levels for some time, and some are priced high enough to consider taking profits. But as we’ve seen over and again the past few years, even the strongest companies occasionally fall out of favor. Strike then and you’ll lock in a windfall.

Conrad's Utility Investor

Invest Smarter! Join Conrad’s Utility Investor!

What sets renowned income-investing expert Roger Conrad apart from the pretenders? His more than two decades of covering utility stocks and essential services—a wealth of knowledge and experience that you can’t find anywhere else.   

Smart investing. Taking advantage of real opportunities and not fads (and knowing the difference). Finding the companies and stocks that will deliver for the long haul, so investing lets you live instead of investing turning into your life. Roger Conrad has dedicated his career to these principles—and that’s what Conrad's Utility Investor delivers.

Subscribe today for instant access to a treasure trove of investment insight and knowledge, as well as Roger’s exclusive model Portfolios and ratings of more than 200 essential services.



Roger S. Conrad needs no introduction to individual and professional investors, many of whom have profited from his decades of experience uncovering the best dividend-paying stocks for accumulating sustainable wealth. Roger b