That same dividend yield acts as a cushion on the downside when times are tough, and as a slight brake on growth during more prosperous periods, as a greater allocation of profits are steered from operations toward shareholders. Below are three bright lights in the utilities sector with great yields and otherwise equally impressive fundamentals.
Motown Energy DTE Energy Company (NYSE:DTE) pays investors 6.2% annually and trades with a P/E of about 10. The stock is up nearly a third since hitting lows in March of this year, besting the DJUA by 5%.
DTE delivers electricity and natural gas to customers in the State of Michigan via two separate business units, Detroit Edison and MichCon, respectively, and between them, they bill nearly 3.5 million customers. The stock trades with a P/B of 0.92 and a price/sales ratio of 0.67.(Learn how to evaluate the quality of these numbers and more in our Financial Raitos Tutorial.)
And to think I always thought the key to making money with DTE was to cry poor to the intelligently overmatched MPSC. Ask for triple of what you really need. Then receive a third of what you asked for from the customer's friend the MPSC. Rinse and repeat every six months! Sit back and watch the money flow in and wipe your tails with hundred dollar bills!
Detroit, once a thriving city with almost 2 million people...now a run down, beat up place with well under a million people with houses that sell for 3 grand...perhaps in time there will be under 1/2 million people....where is the growth for dte.