Utilities are a fairly safe investment. Many utilities have received rate increases, and pay handsome dividends which in my opinion are safe. I own GXP, TE and FPL. Now I am looking for investing into another utility. Last year Energy east was bought out by IBERDROLA, I see mergers and acquisitions in Utility industry in 2010 or 2011, although I doubt in 2009 due to difficult financial situation. FOLKS here is your chance to share information, maybe togather we can contribute to each others knowledge. Please no POLITICS here, and NO Stupid HYPE or overly GLOOM. Thanks
Has anyone done any out of the money covered call writing with their
utility stocks ?
This could create capital gain income
in an after tax account and may
be used to offset capital losses
that all probably have. May also
be done in a retirement account as well.
Ive started to do this with ED, VZ
I like the idea of buying small cap utilities that pay a divy above 5% because I would think that they would be the first ones to be bought up when consolidation occurs. With that in mind, I own GXP, EDE, PNW and TE. I was lucky in owning EAS before they were bought up. I think SCG would also be a good bet, but don't own them just now.
I own the same 3 utilities as well as Dominion (D). I believe the dividends for this group will be safe unless the unemployment hits 11% or more which I believe is highly unlikely.
This group is relatively well-managed with above average operating results and balance sheets which is why I own them. Also, there is a chance OGE will benefit from the large gas reserves under development in their service area. TE and FPL are affected by the horrible Florida real estate situation which seems to have hit bottom a few months ago. It can only get better for them.