Our other 2 power stocks: 1 buy, 1 hold

Article Excerpt

AMEREN CORP. $24 (New York symbol AEE; Income Portfolio, Utilities sector; Shares outstanding: 238.2 million; Market cap: $5.7 billion; Price-to-sales ratio: 0.8; Dividend yield: 6.4%; WSSF Rating: Average) sells electricity and natural gas to 3.4 million customers in Illinois and Missouri. In the three months ended March 31, 2010, Ameren’s earnings fell 16.7%, to $95 million from $114 million a year earlier. Earnings per share fell 25.9%, to $0.40 from $0.54, on more shares outstanding. These figures exclude unusual items, such as gains on fuel-hedging contracts. Revenue was unchanged at $1.9 billion. Colder-than-normal winter weather pushed up electricity demand. However, lower power prices at the company’s non-regulated plants offset gains at its regulated operations. That was the main reason for the lower earnings. Illinois regulators will let Ameren raise its rates this year, but by much less than the company requested. This will give the company an additional $5 million, instead of the $130 million that it wanted. In response, Ameren will lower…