Considering that the 73 utility stocks in the S&P 1500 Index
combine to represent just 4% of the index's market value, they
certainly occupy a big place in the hearts of investors.
we offer a diversified 12-stock utility portfolio, as well as our top
utility choice for investors who only wish to buy one stock in the
Which parts of the utility sector offer the most investment potential depends on your perspective.
the utility sector, electric \utilities and independent power suppliers
are the cheapest and offer the best long-term pro?t potential.
the sector's modest growth and high debt levels have made it dif?cult
for traditional utilities to manage exceptionally high Overall scores.
the other hand, the S&P 1500 Index's diversified and natural-gas
utilities have outperformed the rest of the sector by a wide margin
over the last 12 months and ?ve years.
stock-price momentum, neither group looks expensive. On average, both
groups trade at slightly lower P/E ratios than the ?ve-year average for
stocks in their groups.
With few individual utilities representing obvious buy opportunities, we offer the following two options:
First, if you just want one utility stock, go with Energen
which operates both a natural-gas utility and an energy-production
business. Energen, a Long-Term Buy, is the only utility on our buy
Second, if you're concerned about income and would
rather own traditional utilities, spread your bets with our Top 15
Utilities portfolio, designed to pay a yield comparable to that of the
average utility but provide superior growth potential.
portfolio is designed for investors who seek income and wish to own
traditional utilities. Rather than buy just one or two utility stocks,
we advise investors to spread their bets and purchase equaldollar
amounts of all 15 stocks.
The resultant portfolio yields
nearly as much as the average utility but offers both diversi?cation
and superior capital-gains potential.
L) - yield 4.6%Avista
) - yield 4.7%Cleco
) - yield 3.4%DPL
) - yield 4.7%DTE Energy
) - yield 4.8%Energen
) - yield 1.2%Entergy
) - yield 4.2%Exelon
) - yield 5.0%IDACORP
) - yield 3.4%NextEra Energy
) - yield 3.7%OGE Energy
) - yield 3.6%Oneok
) - yield 3.9%Public Service Enterprises
) - yield 4.1%UGI
) - yield 3.7%UniSource Energy
) - yield 4.8%