NEW YORK, Sept 13 (Reuters) - Many electric utility stocks offer attractively low price-earnings multiples and ample dividend yields, Barron's reported on Sunday.
Regulated utilities trade for about 12 times projected 2009 profits, a discount to the Standard & Poor's 500 stock index at 17 times expected profits, Barron's said. They also trade at an 11.5 multiple, below the broader market's 14, it added.
Dividends also look safe, and investors could see modest annual increases, Barron's said.
Average earnings gains should run at about 6 to 7 percent in coming years, something that has attracted Berkshire Hathaway investment guru Warren Buffett, Barron's said.
One of Berkshire's largest divisions is MidAmerican Energy, Barron's said.
Major utility stocks won't let investors 'make a killing,' Barron's said, but added that many of the shares could see upsides of 10 percent or more in the coming year. That return could be 15 percent with dividends included. The stocks also might hold up better than the S&P if a market correction occurs.
Southern, Consolidated Edison, PG&E, Duke and American Electric are among the safest in the group, Barron's said.
Integrated utilities, which mix regulated and unregulated operations, are more risky and have stocks that trailed regulated operators because of weakness in power prices, Barron's said.
They include Edison International, Dominion Resources, Entergy, Exelon, FPL Group and Public Service Enterprise Group.
(Reporting by Robert MacMillan; Editing by Diane Craft) Keywords: UTILITIES ELECTRIC/ (robert.macmillan@thomsonreuters.com; +1 646 223 6012; Reuters Messaging: robert.macmillan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Regulated utilities trade for about 12 times projected 2009 profits, a discount to the Standard & Poor's 500 stock index at 17 times expected profits, Barron's said. They also trade at an 11.5 multiple, below the broader market's 14, it added.
Dividends also look safe, and investors could see modest annual increases, Barron's said.
Average earnings gains should run at about 6 to 7 percent in coming years, something that has attracted Berkshire Hathaway investment guru Warren Buffett, Barron's said.
One of Berkshire's largest divisions is MidAmerican Energy, Barron's said.
Major utility stocks won't let investors 'make a killing,' Barron's said, but added that many of the shares could see upsides of 10 percent or more in the coming year. That return could be 15 percent with dividends included. The stocks also might hold up better than the S&P if a market correction occurs.
Southern, Consolidated Edison, PG&E, Duke and American Electric are among the safest in the group, Barron's said.
Integrated utilities, which mix regulated and unregulated operations, are more risky and have stocks that trailed regulated operators because of weakness in power prices, Barron's said.
They include Edison International, Dominion Resources, Entergy, Exelon, FPL Group and Public Service Enterprise Group.
(Reporting by Robert MacMillan; Editing by Diane Craft) Keywords: UTILITIES ELECTRIC/ (robert.macmillan@thomsonreuters.com; +1 646 223 6012; Reuters Messaging: robert.macmillan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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