A Small and Hardy Utility
Utilities often provide investors with both a margin of safety and the chance to build income over time through stable, predictable dividend increases. For investors concerned with achieving a growing stream of income - utilities are often very popular. However, in the current economic environment where investors are receiving low, no or even negative total returns by investing in government treasuries - there is a risk of the asset class becoming "too popular."
As many investors have invested in common shares in utilities as a proxy for a "super safe" investment, the increased demand for the asset both drives up the price and drives down yields - making conventional wisdom increasingly suspect and thus increasing...
Only subscribers can access this article, which is part of the PRO research library covering 3,770 different stocks.
Growing numbers of fund managers and other investment professionals subscribe to Seeking Alpha PRO for equity research that is unavailable elsewhere, so they can: