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Portfolio of Electric Utility Stocks
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Well-managed electric utilities are excellent candidates for a dividend reinvestment portfolio. Typically, electric utilities generate lots of excess cash and pay it out as dividends to shareholders.


Look for a company that has consistent earnings growth, a long history of rising dividends and a reasonable payout ratio, which is the ratio of dividends to earnings. A low payout ratio (less than 70 percent) indicates the possibility of future dividend increases. A very high payout ratio (greater than 90 percent) may not be sustainable and may signal a dividend cut in the future.

If the dividend yield (annual dividend divided by stock price) is very high (greater than six or seven percent) the company may be in trouble - the high yield may be due to a low stock price. Be very wary of stocks with high dividend yields and high payout ratios.

The following table includes 17 electric utilities that have multiyear histories of increasing their dividends. These stocks are worth considering for a dividend reinvestment portfolio.

Electric Utilities Stocks
Stock
Quote
Dividend & Dividend Yield
1-Year Price Chart
American Electric Power
2.00 (3.90%)
Cleco
1.60 (2.90%)
Consolidated Edison
2.52 (4.50%)
Dominion Resources
2.40 (3.60%)
Duke Energy
3.18 (4.40%)
Edison International
1.42 (2.50%)
Entergy
3.32 (4.60%)
Exelon
1.24 (4.00%)
FirstEnergy
1.44 (4.60%)
MGE Energy
1.09 (2.80%)
NextEra Energy
2.90 (3.10%)
NiSource
1.04 (2.80%)
PG&E
1.82 (4.10%)
PPL Corporation
1.49 (4.50%)
Southern Energy
2.10 (4.90%)
Wisconsin Energy
1.56 (3.60%)
Xcel Energy
1.20 (3.90%)
Dividend yield data from Yahoo! Finance as of Sep-20-2014. Click small charts (sparklines) to expand. * Uses 10 years or all years of prices, whichever is less.


To follow the progress of the Electric Utilities Stocks portfolio, check out the returns table and chart below. Portfolio values are computed using weekly closes for stocks from Yahoo! Finance.

All 17 stocks are included in the portfolio computations. The current value of the portfolio assumes that $588.24 was invested (total of $10,000) in each stock at its closing weekly price for the current date for 2004.


Electric Utilities Stocks - Return Results
Portfolio:
Electric Utilities Stocks
Start date:
Sep-21-2004
Start value:
$10,000
End date:
Sep-21-2014
End value:
$27,051
Number prices
522
Minimum value occurred on Sep-21-2004
$10,000
Maximum value occurred on Jun-23-2014
$27,657
Total gain or loss (Start date to End date)
170.51%
Annualized gain or loss (Start date to End date)
10.42%
Sharpe Ratio
0.79
Total dollar value on End date of a $10,000 purchase made on Start date
$27,051
Average percent return for all possible buy/sell combinations
31.39%
Number returns
135,981
Number profitable returns (Winners)
118,067
Percent profitable returns
86.83%
Number unprofitable returns (Losers)
17,914
Percent unprofitable returns
13.17%
Winners to losers ratio
6.59


Click chart to enlarge it.



Customize your own Portfolio of Electric Utilities Stocks using stocks from the above table. See returns for specified combinations of stocks for specified durations.


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