3. Duke Energy
> 52 wk high/low: $20.21/$16.87
> % of 52 wk high: 97.5%
> Industry: utilities
> Dividend yield: $1.00 (5.00%)
> Revenue first half: $7.197 billion
> Net income first half: $946 million
Duke Energy Corp. (NYSE: DUK) provides electricity to some 4 million customers in five states and natural gas service to another half million households. The company’s electricity generating capacity is about 35,000 megawatts, of which about 1,000 megawatts come from wind, and another 16 megawatts come from solar generation. Rate regulation guarantees that Duke and the other utilities will make a profit. Regulated utilities are among the very few opportunities in today’s market for relatively guaranteed returns of any size. Revenue rose 12% from 2007 to $14.3 billion last year.
2. American Electric Power
> 52 wk high/low: $38.99/$33.09
> % of 52 wk high: 95.3%
> Industry: utilities
> Dividend yield: $1.84 (4.80%)
> Revenue first half: $6.913 billion
> Net income first half: $708 million
American Electric Power (NYSE: AEP) sells electricity to some 5 million customers in 11 states. About 66% of AEP’s 38,000 megawatts of generation capacity come from coal-fired plants. Another 22% come from natural gas-fired plants, and 6% is generated from nuclear power. The high percentage of coal-fired generation provides AEP a cost advantage over companies with a higher percentage of gas-fired generation. AEP generates more electricity than any other U.S. company and at an overall lower cost. AEP’s revenue rose from $13.4 billion in 2007 to $14.4 billion last year.
1. Consolidated Edison
> 52 wk high/low: $58.79/$47.51
> % of 52 wk high: 96.1%
> Industry: utilities
> Dividend yield: $2.40 (4.20%)
> Revenue first half: $6.342 billion
> Net income first half: $477 million
Consolidated Edison, Inc. (NYSE: ED) provides electricity to 3.3 million customers and natural gas service to about 1.1 million customers in New York City and Westchester County. The company does not generate electricity, but distributes both electricity and natural gas. It is the only utility company included on the S&P Dividend Aristocrats index. Distributing power to the nation’s largest metropolitan area gives the company access to a stable population of business and private customers. Revenue from 2007 to 2010 was flat at just above $13.1 billion. Operating income before one-time charges rose from $1.8 billion to $2.1 billion over the same period.
Paul Ausick, Douglas A. McIntyre, and Charles Stockdale
