emera

While they sometimes lack high-growth potential, utilities are generally stable, profitable businesses with limited competition—and they offer investors high yields. As a result, as a group, they have a better long-term stock market performance than the overall market and come with less volatility and risk.


The U.S....

EMERA INC. $50 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 235.9 million; Market cap: $11.8 billion; Price-to-sales ratio: 1.8; Dividend yield: 4.7%; TSINetwork Rating: Average; www.emera.com) owns 100% of Nova Scotia Power, that province’s main electricity supplier....

One key fact about life in today’s investment world is that it offers a multitude of choices. I mentioned a few weeks ago that when we feel a particular industry segment or business tactic works against investor interests, we don’t make a “best of a bad bunch” selection....

These four utilities are converting their older plants to cleaner-burning fuels and building new green-power projects. Those investments will help reduce the impact of new carbon taxes and let them keep raising their dividends.


CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] $34 and CU.X [class B voting] $34; Income Portfolio, Utilities sector; Shares outstanding: 272.1 million; Market cap: $9.3 billion; Price-to-sales ratio: 2.1; Dividend yield: 5.0%; TSINetwork Rating: Above Average; www.canadianutilities.com) distributes electricity and natural gas in Alberta and Australia....

A: Preferred shares behave more like long-term fixed-income instruments rather than short-term instruments. So while short-term interest rates are still relatively low, the outlook for long-term interest rates is less certain.

The underlying credit quality of preferred share issuers can be a negative factor in some cases; for example, when the issuer’s share price is falling.

So unlike GICs, which don’t fall in value, the prices of preferreds can decline along with stock markets.

If you want to own a preferred share as part of the fixed-income segment of your portfolio, and you can accept some risk, then preferreds are okay to hold....

EMERA INC. $44 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares o/s: 233.0 million; Market cap: $10.3 billion; Price-to-sales ratio: 1.7; Divd. yield: 5.4%; TSINetwork Rating: Average; www.emera.com) has spent $2 billion in the past year on new projects....

The six ETFs we update below mainly hold high-quality stocks that are widely traded on Canadian and U.S. exchanges. Each fund tracks the performance of a major stock market index. That’s different from ETFs focused on narrower indexes or themes such as cryptocurrencies or biotechnology.


Of course, you pay brokerage commissions to buy and sell these investments....

A: BMO Canadian High Dividend Covered Call ETF, $18.36, symbol ZWC on Toronto (Units outstanding: 21.1 million; Market cap: $387.4 million; www.bmo.com/gam/ca/investor/products/etfs), focuses on mostly high-quality Canadian stocks....

Emera now plans to raise its annual dividend rate between 4% and 5% each year through 2021. That’s down from its previous aim to raise the dividend 8% annually through 2020.


The company cut that growth target to conserve cash for new projects and pay down debt....

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; Shares outstanding: 272.1 million; Market cap: $8.4 billion; Price-to-sales ratio: 1.9; Dividend yield: 5.1%; TSINetwork Rating: Above Average; www.canadianutilities.com) distributes electricity and natural gas in Alberta and Australia....