The Southern Company (SO), El Paso Electric Company (EE), Duke Energy Corp (DUK): Look for Buys Now That Utilities Are on the Outs

That’s a big deal and management is working to integrate the two companies so it can achieve fairly aggressive cost savings. Most of those savings are to be passed on to customers, so missing the targets would be bad for shareholders. However, Duke Energy Corp (NYSE:DUK) has a solid relationship with most of its regulators, regulated markets now account for about 90% of its business, and building plans should lead to rate increases. That, in turn, will support long-term growth and dividend increases.

The shares currently yield around 4.4%. If that jumps into the 5.5% to 6.5% range, investors should happily jump aboard. News, however, might be a big factor in day-to-day share prices moves as the Progress integration continues.

Boring, but reliable

Utilities are pretty boring companies, but that’s exactly why they are considered perfect widow and orphan stocks. The Southern Company (NYSE:SO) and El Paso Electric Company (NYSE:EE) both operate in growing markets, which gives them a head start over the competition. Duke, meanwhile, has taken on an important merger that has helped to reshape its business. All three are worth a look if the utility sell off continues.

The article Look for Buys Now That Utilities Are on the Outs originally appeared on Fool.com.

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