Utilities: 20 Best Buys
Dividend Yield | Jan 08, 2013 11:15AM ET
Some investors love utilities, others hate them. I am somewhere in the middle. I never invested money into the utility sector because I know that strong growth is nearly impossible at low investment cots. So you should not get a quick big return.
The only chance to make money is with time optimized stock trading. But that's too complicated for me and means hard work. I love to buy high-quality growth stocks to receive the dividends without having to worry about keeping an eye on anything.
The good thing about utilities is that they generate stable cash flows and can use the incoming money to pay high dividends and repurchase shares. I believe that it makes more sense to buy bonds of those companies because if the company gets into trouble, the dividend payments and share buyback programs will be reduced first. Bondholders suffer last.
I made a list of the 20 best stocks -- excluding those with a market capitalization below USD 2 billion -- because I think the risk should be much higher than for mid-capitalized stocks.
- National Grid (best buy rated utilities . The average P/E ratio amounts to 28.43 and forward P/E ratio is 21.15. The dividend yield has a value of 2.78%. Price to book ratio is 2.63 and price to sales ratio 1.87. The operating margin amounts to 13.51% and the beta ratio is 0.79. Stocks from the list have an average debt to equity ratio of 2.56.
Related stock ticker symbols:
CIG, NGG, LNT, IDA, NU, UGI, TRGP, OKE, EIX, OGE, SBS, AWK, NRG, AES, EQT, HNP,
ELP, CPN, KEP, WGPUtilities with a buy or better rating originally published at long-term-investments.blogspot.com.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I receive no compensation to write about any specific stock, sector or theme.
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