|Bid||0.00 x 2400|
|Ask||0.00 x 2700|
|Day's Range||54.31 - 54.96|
|52 Week Range||47.37 - 56.90|
|PE Ratio (TTM)||8.98|
|Beta (3Y Monthly)||0.05|
|Expense Ratio (net)||0.14%|
Jason Ware, Albion Financial Group, and Chris Zaccarelli, Independent Advisor Alliance, discuss how investors should position their portfolios during volatile times.
The materials sector up almost 3% today with DowDuPont as the best performing stock among the bunch. The utilities sector was weighed down by companies including Edison, Dominion and NextEra Energy.
In this part, we’ll discuss the top utilities’ (XLU) target prices and analysts’ views. Top utility stock NextEra Energy (NEE) has an estimated upside of ~3% based on its median target price of $181.47 and its current price of $176.56. Morgan Stanley raised NextEra Energy’s target from $184.0 to $185.0 on November 9.
AES (AES), one of the smallest constituents of the Utilities ETF (XLU), is the top-rallied stock among its peers. So far, AES has risen more than 43% in 2018. Strong quarterly earnings growth influenced AES’s market performance in 2018. Currently, AES is trading close to its four-year high.
The technology sector and Apple in particular led a stock market sell-off Monday that saw the Nasdaq composite plunge nearly 3%.
Let’s take a look the biggest utilities’ total returns in 2018. So far, utilities at large have returned (including dividends) 7% in 2018, while broader markets have returned a little more than 5%. Utilities (XLU) generally offer higher dividend yields compared to broader markets.
Utilities (IDU) (VPU) at large have rallied more than 7% since the Fed delivered its third rate hike in 2018 in September. The Utilities Select Sector SPDR ETF (XLU) is trading at $54.87—more than 2% and 6% above its 50-day and 200-day moving average levels, respectively. The premium to the support levels indicates strength in XLU. These moving average levels close to $53.70 and $51.58 could act as a support for XLU going forward.
Utilities continued to trade strong and outperformed broader markets last week. The representative of the S&P 500 Utilities Index, the Utilities Select Sector SPDR ETF (XLU) rose 3.2%, while the S&P 500 gained more than 2% for the week ending November 9. Investors turned to relatively safer utilities amid broader market volatility. So far in 2018, utilities at large have risen more than 5%—marginally above broader markets.
Southern Company (SO), the fourth-biggest utility by market capitalization, released its third-quarter earnings on November 7. In the third quarter of 2017, Southern Company had an EPS of $1.12. Favorable weather and constructive regulatory results were some of the main drivers behind Southern Company’s earnings in the third quarter.
PG&E (PCG) stock has an estimated upside of 10% for the next 12 months based on analysts’ median target price of $53.47 and its current market price of $48.71.
PG&E (PCG) stock is trading at $48.71, which is ~1% and 8% above its 50-day and 200-day moving averages, respectively. PG&E’s premium to both of these support levels indicates strength in the stock. The levels of ~$44.96 and $43.93 could act as supports for the stock in the near future.
When broad market volatility picks up, it is not uncommon to see investors allocate capital to relatively stable segments such as reserve currencies, fixed income, precious metals, utilities and financials. In the paragraphs below, we'll take a look at several charts from within the utilities sector. The increased buying pressure is evident on the chart of the Utilities Select Sector SPDR Fund.
PG&E (PCG) stock is trading at a forward PE ratio of 12x based on its estimated earnings for 2019. The company’s five-year historical PE ratio is at 20x. Peers’ average forward PE ratio is ~14x. PG&E stock seems to be trading at a discounted valuation compared to peers and its historical average.
PG&E (PCG) reported its third-quarter results on November 5. The company reported an adjusted EPS of $1.13 for the quarter ending on September 30. In the same quarter last year, the company earned $1.12 per share.
NextEra Energy (NEE), the biggest constituent of the Utilities Select Sector SPDR ETF (XLU), has a potential upside of 8% based on analysts’ median target price of $181.41 and its current price of $168.15. Among the top utilities, NEE seems to be analysts’ favorite. Fourteen of the 18 analysts tracking it have given it “buy” ratings.
NextEra Energy (NEE), the biggest utility by market cap, is currently trading at a forward PE of 20x based on its estimated earnings for 2019. Its five-year historical average PE is close to 20x.
After a strong October, utility (IDU) (VPU) stocks started November off on a relatively weak note. The Utilities Select Sector SPDR ETF (XLU), the representative of the S&P 500 Utilities Index, broke below its 50-day moving average, which could indicate impending softness.
The Utilities Select Sector SPDR ETF (XLU), a representative of the S&P 500 Utilities Index, fell 0.4% while broader markets rose 2.5% last week.
While the rest of the markets stumbled, utilities stocks and sector-related ETFs continued to push forward over October. Over the past month, the Utilities Select Sector SPDR (NYSEArca: XLU) gained 1.9%, ...
Duke Energy (DUK), the second-largest utility by market cap, reported its third-quarter earnings today. It reported adjusted earnings of $1.65 per share for the quarter ended September 30, beating analysts’ estimates of $1.52 per share. In the same quarter last year, Duke Energy earned $1.59 per share.
To help investors keep up with the markets, we present our ETF Scorecard. The Scorecard takes a step back and looks at how various asset classes across the globe are performing. The weekly performance is from last Friday’s open to this week’s Thursday close.
Southern Company (SO) is the third-largest utility by market cap in the country. Currently, Southern Company stock is trading at a forward PE ratio of 15x based on the estimated EPS for the next year. Southern Company’s forward PE ratio is lower than its peers’ average forward PE ratio of 17x. Southern Company’s five-year historical average PE ratio is also higher than its forward PE ratio. Southern Company stock appears to be trading at a discount compared to its historical valuation and its peers.
Dominion Energy (D), one of the largest utilities in the country, reported its third-quarter results today. It reported earnings of $1.15 per share for the quarter ended September 30, beating analysts’ estimates by two cents. In the same quarter last year, Dominion Energy reported earnings of $1.04 per share.
Southern Company (SO) is expected to report an EPS of $1.07 for the quarter ending on September 30. Southern Company’s management has given an EPS guidance of $1.05 for the third quarter. During Southern Company’s second-quarter earnings, its principal subsidiary Georgia Power announced another cost increase of $1.1 billion associated with Plant Vogtle.
Southern Company (SO), one of the largest regulated utilities, is expected to report its third-quarter results on November 7. According to consensus estimates, Southern Company is expected to report total revenues of $6.35 billion for the quarter ending on September 30, which implies revenue growth of 2.3% year-over-year. The expanding customer base became vital for US utilities after the electricity usage per customer declined due to energy efficiency programs over the years.