We Like The Outlook For These Utilities

Article Excerpt

Alliant and Ameren have moved down lately, largely due to fears that floods in the Midwest and rising fuel costs will hurt their earnings growth. However, power regulators will probably let them recover these extra costs through higher rates. ALLIANT ENERGY CORP. $33 (New York symbol LNT; Income Portfolio, Utilities sector; Shares outstanding: 110.4 million; Market cap: $3.6 billion; WSSF Rating: Average) supplies electricity and natural gas to customers in Wisconsin, Iowa, Minnesota and Illinois. Recent flooding forced the company to suspend operations at two of its generating stations in Cedar Rapids, Iowa. Although insurance will help cover some of its losses, the company estimates the flood will cut its 2008 earnings by $0.20 a share. To put that estimate in perspective, Alliant earned $0.62 a share (total $68.1 million) in the first quarter of 2008, up 10.7% from $0.56 a share ($65.2 million) a year earlier. Revenue grew 8.7%, to $992.0 million from $912.7 million. Alliant now plans to build a wind farm…