Utilities Sector Sees Gains Amid Market Decline

Strategic Insights -

In a mixed trading day, the utilities sector rose 0.3% compared to the S&P 500, which declined 1.0%. Top gainers within the sector included WEC Energy Group, Public Service Enterprise Group, and Entergy, all up 1.1% or more. Notable decliners included Empresa Nacional de Electricidad, Praxair, and Edison International, down 2.6%, 1.5%, and 0.9% respectively. TheStreet highlighted three stocks pushing the sector higher: PPL Corporation, Southern Company, and Duke Energy Corporation.

Key Takeaways:

  • PPL Corporation, a utility company, delivered electricity and natural gas in the United States and the United Kingdom, serving 1.2 million customers.
  • The company has a market cap of $21.7 billion and is part of the utilities industry, with shares down 10.8% year-to-date.
  • 7 analysts rate PPL a buy, no analysts rate it a sell, and 5 rate it a hold, with TheStreet Ratings also rating it as a buy.
  • The company's strengths include a significant increase in stock price during the past year, notable return on equity, growth in earnings per share, and expanding profit margins.
  • PPL has a PEG ratio of 1.3, indicating fair value, with a 5-year dividend growth rate of 15.3%.
  • Southern Company, together with its subsidiaries, operated as a public electric utility company, with a market cap of $41.4 billion and part of the utilities industry, with shares down 7.4% year-to-date.
  • The company's strengths include expanding profit margins, growth in earnings per share, increase in net income, and increase in stock price during the past year.
  • Southern has 1 analyst rating it a buy, 3 analysts rate it a sell, and 9 rate it a hold, with TheStreet Ratings also rating it as a buy.
  • The company has a PEG ratio of 1.2, indicating fair value, with a 5-year dividend growth rate of 3.9%.
  • Duke Energy Corporation, together with its subsidiaries, operated as an energy company in the United States and Latin America, with a market cap of $52.0 billion and part of the utilities industry, with shares down 10.4% year-to-date.
  • The company's strengths include good cash flow from operations, expanding profit margins, and increase in stock price during the past year.
  • Duke Energy has 6 analysts rating it a buy, 1 analyst rate it a sell, and 9 rate it a hold, with TheStreet Ratings also rating it as a buy.
  • The company has a PEG ratio of 1.4, indicating fair value, with a 5-year dividend growth rate of 2.3%.

Statistics:

  • PPL Corporation's stock price has increased by 10.8% in the past year, with a 5-year dividend growth rate of 15.3%.
  • Southern Company's stock price has increased by 8.2% in the past year, with a 5-year dividend growth rate of 3.9%.
  • Duke Energy Corporation's stock price has increased by 6.3% in the past year, with a 5-year dividend growth rate of 2.3%.
  • The Utilities Select Sector SPDR ETF (XLU) has a 3-month average trading volume of 7.4 million shares per day.
  • The ProShares UltraShort Utilities ETF (SDP) has a 3-month average trading volume of 1.8 million shares per day.

Sources:

  • TheStreet
  • WEC Energy Group (http://www.thestreet.com/quote/wec.html)
  • Public Service Enterprise Group (http://www.thestreet.com/quote/peg.html)
  • Entergy (http://www.thestreet.com/quote/etr.html)
  • Empresa Nacional de Electricidad (http://www.thestreet.com/quote/eoc.html)
  • Praxair (http://www.thestreet.com/quote/px.html)
  • Edison International (http://www.thestreet.com/quote/eix.html)
  • Utilities Select Sector SPDR (http://www.thestreet.com/quote/XLU.html)
  • ProShares UltraShort Utilities (http://www.thestreet.com/quote/SDP.html)