U.S. Markets open in 6 hrs 43 mins

The Zacks Analyst Blog Highlights: Unitil, Southwest Gas, Alliant Energy, The York Water Company and American States Water Company

Zacks Equity Research

For Immediate Release

Chicago, IL – August 13, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include:Unitil Corporation UTL, Southwest Gas Holdings, Inc. SWX, Alliant Energy Corporation LNT, The York Water Company YORW and American States Water Company AWR.

Here are highlights from Monday’s Analyst Blog:

5 Utility Stocks You Should Buy Right Now

On Jul 31, the Federal Reserve announced a 25-basis point rate cut, which was far below investors' expectations. Further, the Fed Chair referred to the reduction as a “midcycle adjustment.” Investors expecting a wider rate cut and assuming this was the beginning of a rate cut cycle were disappointed.

Consequently, all major indexes closed in the red. Stocks fell further on Aug 1, with President Trump announcing plans to impose a 10% tariff on $300 billion of Chinese products.

Major indexes have been facing turbulence since May 2019 due to the trade war between the United States and China. On Aug 1, Trump’s statement worsened matters as shares of giants dependent on China for international trade fell sharply. Apple Inc. (AAPL) shares fell by 2.2%, global traders Caterpillar Inc. (CAT) and Deere & Company’s (DE) shares fell 3.7% and 2.7%, respectively.

With China lowering its currency value and Trump standing firm on his plans of raising tariffs, both companies and investors are suffering. This is why it makes sense to invest in safe-haven options like utility stocks.

Utility Stocks Look Attractive

Since markets are passing through difficult times, investors are turning more and more risk averse with every passing day. This is why they are increasingly considering safe-haven options such as utility stocks. They offer steady dividends and are less susceptible to market gyrations even during volatile trading.

Utility stocks benefit from a low-interest-rate environment as they have a disproportionally large debt component. Hence, they can provide a higher dividend to shareholders even in the low-rate environment because their debt servicing burden goes down. In fact, utilities provide a cushion to most portfolios during a period of high market volatility and a slowing economy.

The latest reports from the U.S. Commerce Department shows that the GDP hit the pace of 2.1% in the second quarter, which is much below the first-quarter rate of 3.1%. In fact, as per reports of the Department of Labor the nonfarm payroll numbers for July is 164,000 jobs compared to 165,000 in June. Hence, decrease in key economic statistics is clearly visible, pointing toward a slowing economy.

5 Winning Stocks

Following signs of a weak economy, low interest rate cut expectation and intensifying trade war between the United States and China, the market has turned highly volatile. Utilities not only offer dividends but demand for their services remain largely unchanged during weak economic conditions.

We have narrowed down our search to a Zacks Rank #2 (Buy) and strong dividend yield. You can see the complete list of today’s Zacks #1 Rank stocks here.

Unitil Corporation is a publicly traded utility company that serves New Hampshire, MA, and Maine with electricity and natural gas. Unitil’s expected earnings growth for the current year is 4%. The Zacks Consensus Estimate for current-year earnings has improved 0.9% over the past 30 days. The stock has a dividend yield of 2.5%.

Southwest Gas Holdings, Inc. is an energy holding company based in Las Vegas, NV. The company’s expected earnings growth for the current year is 6.5%. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the past 90 days. The stock has a dividend yield of 2.5%.

Alliant Energy Corporation is a public utility holding company that generates and distributes electricity, and distributes and transports natural gas in Iowa. The company’s expected earnings growth for the current year is 3.7%. The Zacks Consensus Estimate for current-year earnings has improved by 0.4% over the past 60 days. The stock has a dividend yield of 2.8%.

The York Water Company impounds, purifies and distributes water and is regulated by the Pennsylvania Public Utility Commission. The company’s expected earnings growth for the current year is 7.7%. The Zacks Consensus Estimate for current-year earnings has improved 0.9% over the past 30 days. The stock has a dividend yield of 1.9%.

American States Water Company provides water service to customers in Northern, Coastal and Southern California. The company’s expected earnings growth for the current year is 18.6%. The Zacks Consensus Estimate for current-year earnings has improved 2.5% over the past 30 days. The stock has a dividend yield of 1.3%.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.

This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.

See their latest picks free >>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com                                   

https://www.zacks.com                                                 

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Alliant Energy Corporation (LNT) : Free Stock Analysis Report
 
Unitil Corporation (UTL) : Free Stock Analysis Report
 
Southwest Gas Corporation (SWX) : Free Stock Analysis Report
 
American States Water Company (AWR) : Free Stock Analysis Report
 
The York Water Company (YORW) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research