One way to maintain a margin of safety when buying new positions or adding to current holdings of stock is by buying near the 52 week low. Here are three electricity generation stocks within 5% of their 52 week ranges:
1. NRG Energy Inc. (NYSE:NRG) is a Fortune 250 wholesale power generation company headquartered in Princeton, New Jersey. It owns and operates one of the industry's most diverse generation portfolios including nuclear, wind and solar power and provides roughly 26,000 megawatts of electric generating capacity. NRG's combined businesses serve more than 1.8 million residential, business, commercial and industrial customers. NRG has a market cap of $3.8 billion and is trading near its 52 week low with a range of $16.06 to $25.66.
2. Exelon Corporation (NYSE:EXC) is a Chicago, Illinois-based company which operates as a utility services holding company and deals mainly with the generation of electricity for residents of the North Eastern United States. Exelon generates electricity from nuclear, fossil, hydroelectric and renewable energy sources such as solar and wind. It also caters to customers looking to buy natural gas at wholesale prices, as well running an energy transmission and distribution service segment and serves nearly six million residential, commercial, industrial and wholesale customers. Exelon has a market cap of $26 billion and is trading near its 52 week low with a range of $38.57 to $45.45.
3. TransAlta Corporation (NYSE:TAC) is a wholesale power generator with operations in Canada, the United States and Austrailia. TransAlta manages a portfolio of assets including coal, natural gas, hydroelectric, wind geothermal and biomass. TransAlta has a market cap of $4.5 billion and is trading near its 52 week low with a range of $19.63 to $23.09.
Of course, there is always a reason why a stock is trading at a deep discount. Perhaps it has a very small market cap and very few analysts follow it. Maybe there is an underlying issue with the business or possibly the market as a whole has decided to pull back. It's always a safe idea to perform due diligence on stocks nearing 52 week lows in order to examine the reason for their price decline prior to investing.
Disclosure: I am long EXC.