Portfolio of Electric Utilities Stocks
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 have problems - 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 10 electric utilities that have multiyear histories of increasing their dividends. These stocks are worth considering for a dividend reinvestment portfolio.
Electric Utilities Stocks
Annual Dividend & Yield
1-Yr Price Chart
|American Electric Power||
|Hawaiian Electric Industries||
|Dividend data from Yahoo! Finance as of May-22-2017.|
To inspect the performance of the Electric Utilities Stocks portfolio, see the returns table and chart below. Portfolio values are computed using quarterly closes from Quandl. All 10 are included in the portfolio computations. The current value of the portfolio assumes that $1,000.00 was invested (total of $10,000) in each at its closing quarterly price for the current date in 2007.
Electric Utilities Stocks - Return Results
Electric Utilities Stocks
|Minimum value occurred on Mar-31-2009|
|Maximum value occurred on Jun-30-2016|
|Total gain or loss (Start date to End date)|
|Annualized gain or loss (Start date to End date)|
|Total dollar value on End date of a $10,000 purchase made on Start date|
|Average percent return for all possible buy/sell combinations|
|Number profitable returns (Winners)|
|Percent profitable returns|
|Number unprofitable returns (Losers)|
|Percent unprofitable returns|
|Winners to losers ratio|
|See Stock Return Calculator for return information for individual stocks.|
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Utilities Exchange-Traded Funds (ETFs)