Growing utility’s new target cuts risk

Growing utility’s new target cuts risk

This diversified Canadian utility plans to raise its annual dividend rate between 4% and 5% each year through 2021. That’s down from its previous 8% target, but this more modest growth conserves cash for new projects and pays down debt.

That’s why this company has our… Read More

Expect dividend increases from these four

Rising interest rates generally reduce the appeal of income stocks, including utilities. However, recent acquisitions by these four industry leaders—and their new projects—set them up for years of higher dividends.
CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] $31 and CU.X [class B voting] $31; Income Portfolio, Utilities sector;… Read More

Updating BCE Inc., Bank of Montreal and Emera Inc.

BCE INC. $51 (Toronto symbol BCE; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 898.0 million; Market cap: $45.8 billion; Price-to-sales ratio: 2.0; Dividend yield: 5.8%; TSINetwork Rating: Above Average; stands to gain from the new trade agreement between the U.S., Mexico and Canada (called… Read More

Look beyond their latest quarterly results

All four of these power and gas utilities reported lower earnings for the second quarter of 2018. Moreover, rising interest rates have hurt their appeal among income-seeking investors. Higher rates will also increase their borrowing costs as they raise funds for new projects.
Even so, most… Read More

Updating Emera Inc.

EMERA INC. $42 (Toronto symbol EMA; Income-Growth Payer Portfolio, Utilities sector; Shares outstanding: 227.8 million; Market cap: $9.6 billion; Dividend yield: 5.4%; Dividend Sustainability Rating: Highest; owns 100% of Nova Scotia Power, that province’s main electricity supplier. This business supplies 20% of Emera’s earnings. The remaining 80%… Read More

Utilities still appealing despite rising rates

Share prices for these four power producers have dropped recently. That’s mainly because rising interest rates have increased the appeal of bonds for income-seeking investors. As well, higher interest rates will make it more expensive for utilities to refinance their own outstanding bonds.
However, all four… Read More

Focus on their dividends, not interest rates

Rising interest rates have increased the attractiveness of bonds and hurt interest in high-yielding dividend stocks like these four utilities. However, steady cash flows from their high-quality operations will continue to let them keep increasing their payouts.

EMERA INC. $43 (Toronto symbol EMA; Income Portfolio,… Read More