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George Fisher  

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  • National Fuel Gas: Buying A Dollar Of Value For 75 Cents, Or Buy, Buy, And Then Buy Some More
    Sep. 19, 2014 NFG 8 Comments

    Summary

    • Mario Gabelli estimates National Fuel Gas is worth $100 share while the current market price is $74.
    • Gabelli has filed the paperwork to place a proposal for shareholder vote to split the utility into a separate company, similar to Oneok and One Gas.
    • At today’s price, not only is the firm undervalued by 33%, it offers the most Marcellus acres per $1 million of Enterprise Value compared to its peers.
  • Hong Kong And China Gas: Gas Utility With China Growth Prospects
    Editors' Pick • Sep. 19, 2014 HOKCY 1 Comment

    Summary

    • Hong Kong and China Gas (TownGas) offers exposure to the growing gas distribution business in China. The firm is the largest utility serving both HK and the Mainland.
    • 55% of revenues are from Mainland China, and gas volumes are expected to continue their double-digit growth for the foreseeable future.
    • Opportunities encompass the entire natural gas "food chain" (ex-exploration) - from pipelines and midstream facilities, to retail/industrial distribution, to vehicle filling stations, to infrastructure.
    • Russia's massive $400 billion gas contract with China amounts to only 20% of consumption growth to 2020.
  • How Is Your Regulated Electric Utility Handling Distributed Generation?
    Sep. 12, 2014 AEP, AQUNF, AWR 25 Comments

    Summary

    • Rooftop solar panel installations are creating structural changes to the regulated electric utility business.
    • The extent of this disruptive technology affecting a specific utility’s bottom line will be determined by the company's programs and state regulations.
    • It is not too early to begin adding Distributed Generation to your regulated electric utility due diligence.
  • If You Like Chicago Bridge & Iron, You May Want To Own Oil Infrastructure Construction Firm AMEC
    Sep. 10, 2014 AMCBF 16 Comments

    Summary

    • AMEC is expanding its presence in the oil and gas infrastructure engineering and construction industry by acquiring Foster Wheeler.
    • Earnings revisions to the downside, mainly due to currency fluctuations, will hurt share prices in the short term, but the Foster Wheeler acquisition will be the future driver of higher earnings.
    • While not as large as CBI’s backlog, AMEC and Foster Wheeler combined have an order backlog of $10 billion. This represents about 15 months of business.
  • TransAlta: Power Producer's Reset Preferred Shares May Be Preferred Over The Common
    Sep. 8, 2014 TAC 9 Comments

    Summary

    • TransAlta has been a poor selection in the Independent Power and Renewable Electricity Producers industry.
    • TransAlta 2014 ocf may cover cap ex plus dividend, but just barely.
    • Better times may lie ahead, but not until 2018.
  • Geothermal Power Producers - Lowest Levelized Cost, Base Load Compatible And A 100-Year History
    Editors' Pick • Aug. 26, 2014 CPN, EGDCY, LXU 9 Comments

    Summary

    • Geothermal power has the lowest levelized costs of all power generating plant designs.
    • There are a few smaller companies offering exposure to the geothermal industry.
    • Geothermal is the only alternative fuel that is also base load compatible.
  • Duke Energy - Buy For Income And Income Growth, But Not For Value
    Aug. 22, 2014 DUK 9 Comments

    Summary

    • Duke Energy's dividend growth could increase from 2% to over 3.8%.
    • Management's new 2014 guidance is $4.50 to $4.65 EPS and a 4% to 6% growth rate, with a target of 65% to 70% dividend payout ratio.
    • The Multi-Utilities industry is technically better positioned than Water and Gas Distribution industries for further share price increases.
  • Avista: Fully Valued Utility With Adequate Income And Acquisition Potential
    Aug. 18, 2014 AVA 6 Comments

    Summary

    • Current stock valuations leave some room for multiple expansions, but management’s ROIC performance should not be valued at a premium.
    • Avista’s renewable generating assets may be attractive to others.
    • Total returns have been closer to the S&P 500 than the outperformance of the Multi-utility segment.
  • Exelon: Buy The Dip
    Aug. 18, 2014 EXC 18 Comments

    Summary

    • Natural gas pricing will rise in the Northeast.
    • Power demand and pricing is recovering in PJM territories.
    • While the merchant power investment story is being diluted by regulated asset acquisitions, 50% of future earnings will be tied to commodity pricing, which looks promising.
  • Southern Company - Still A Buy, But Currently Fully Valued
    Aug. 7, 2014 SO 8 Comments

    Summary

    • Reduction in Cap Ex budgets will improve the current negative Free Cash Flow Minus Dividends spread.
    • Southern Company’s stock price is fairly valued.
    • Dividend should continue to grow at a 4% annual rate.
  • Utilities And Rising Interest Rates: Fact Or Fiction?
    Jul. 14, 2014 XLU 21 Comments

    Summary

    • History points to rising interest rate cycles of 2004 to 2007, 1993 to 2000, and 1986 to 1989.
    • At the top of the cycle, the yield curve flattens.
    • Utilities continued to provide positive total returns from the beginning of tightening to the end of tightening. Shareholder problems lie in the down cycle, not the up cycle.
  • How Much Money Are You Planning To Lose In Your Bond Portfolio?
    Jul. 10, 2014 AGG, BOND, BND 61 Comments

    Summary

    • Goldman Sachs moves up the date for interest rate hikes, and pegs a 2018 Fed Fund rate at 4.0%.
    • Review past yield curves for a possible glimpse into the future.
    • It is easy to determine interest rate risk for individual bond fund portfolio designs.
  • CLP Holdings: 4.1% Yield Limits Potential Downside
    Jul. 7, 2014 CLPHY 2 Comments

    Summary

    • A turn in Australia’s energy markets is needed to get back on track for even modest dividend growth.
    • CLPHY 10-yr total returns have equaled S&P 500 with a beta of just 0.20. Same return, substantially less volatility.
    • Current share valuations are in line with both CLPHY’s 5-yr average and its US counterparts.
  • Electricity Transmission Assets: No Longer A Crown Jewel?
    Jun. 24, 2014 AEP, DUK, EIX 8 Comments

    Summary

    • FERC is lowering the allowed base ROE for transmission investments.
    • The ROE incentive for transmission investments over state-regulated assets will evaporate for most utilities.
    • The Midwest ISO could experience the highest reduction in profitability based on a 14.5% reduction in allowed ROE.
  • PPL: A Utility Completing Its Evolution
    Jun. 23, 2014 PPL 8 Comments

    Summary

    • PPL is jettisoning its merchant power business by merging with selected assets of Riverstone to form Talen Energy.
    • It seems odd timing, as PJM merchant power pricing seems to finally be improving.
    • Dividend growth going forward will probably remain sub-par.
  • Chicago Bridge And Iron - Speculative Buy
    Jun. 20, 2014 CBI 31 Comments

    Summary

    • CBI has a long history of creating shareholder value, based on its cyclicality. In addition, CBI has a long history of successful acquisitions and integrations.
    • Management needs to reply to the accusations – and the sooner the better. But shareholders should not hold their breath waiting.
    • Even with the current price weakness, CBI is “fairly valued”, and a “speculative buy” until the dust settles.
  • FirstEnergy: Turnaround In Store For Patient Shareholders
    Jun. 17, 2014 FE 11 Comments

    Summary

    • 2014 should be a trough year for FirstEnergy.
    • After a dividend cut in January, weaker players have been shaken out with trading volume since the announcement about equal to shares outstanding.
    • FirstEnergy is eerily similar to Exelon, but share prices have not mirrored Exelon's 36% total return y-t-d.
  • Consolidated Water: Not Very Compelling Valuation
       • Jun. 10, 2014 CWCO 15 Comments

    Summary

    • While desal is an intriguing industry with growth prospects, Consolidated Water has not been best in class.
    • Operating Cash Flow and Return on Invested Capital has been in a downward spiral for several years.
    • Mexican desal project could be substantial, but will take years to bring on line, after finding a financial sugar daddy.
  • American States Water: Higher Political Risk Makes Watching From The Sidelines Prudent
       • May. 28, 2014 AWR 25 Comments

    Summary

    • With a severe drought in California, the political risks for American State Water increases.
    • American States Water has outperformed the S&P 500, but not so much its peers.
    • Better investment opportunities and lower risk may lie in water utilities serving the Northeast, Southeast, and Eastern Midwest.
  • Utility Firms That Are 'Good In Bed'
    May. 20, 2014 EXC, ITC, NFG 9 Comments

    Summary

    • Look for specific events to positively impact stock valuations over time.
    • Review reasons for lower ROIC leading to lower earnings.
    • “Cause and Effect” is alive and well in utility investment stories, ranging from higher FERC regulated assets to a turn in electricity pricing.
  • Gabelli Pressures National Fuel Gas To Realize Shareholder Value
    May. 12, 2014 NFG 7 Comments

    Summary

    • National Fuel Gas is 33% undervalued, according to Mario Gabelli. Gabelli is beginning to flex his muscles with a 9.1% share of outstanding stock.
    • National Fuel Gas is diversified with gas utility, midstream and E&P assets. It holds the largest acreage in the Marcellus with 800,000 acres. These are mainly fee based, not leases.
    • National Fuel Gas raised earnings guidance to $3.40 - $3.55 a share for FY 2014.
  • UGI Corp.: A Gas Utility That Dividend Growth Investors Can Love
    May. 12, 2014 UGI 15 Comments

    Summary

    • UGI has raised its dividend annually for the past 27 years and has a 130 year history of dividend payouts.
    • UGI has $9.10 per share of interest in AmeriGas Propane LP and is the GP with profitable IDRs.
    • Heating fuel conversion within hook-up range of current pipelines could grow customer base by 41% over time.
  • ITC Holdings Is A Core Utility Asset, Especially For Dividend Growth Investors
    May. 5, 2014 ITC 3 Comments

    Summary

    • ITC has offered long-term annual total returns of 11.1% vs. 7.7% for regulated utilities.
    • FERC-Allowed ROE for ITC is between 21% and 38% higher than recent average State-PUC awards.
    • ITC is laser-focused on expanding its Transmission Rate Base between now and 2018.
  • Is Comment Crowdsourcing Correct On Exelon?
    Apr. 25, 2014 EXC 48 Comments

    Summary

    • EXC has been a much maligned stock suggestion.
    • Investors who purchased between July 2005 and December 2011 are still underwater on a total return basis while most all other investors should have a positive total return.
    • Share prices are up 33% since January 2014.
  • Public Service Enterprise: Buy For Transmission Growth
    Mar. 18, 2014 PEG 6 Comments

    Summary

    • 68% of CapEx to be Invested in superior ROE transmission growth.
    • Well-managed balance sheet.
    • Transmission growth will Drive ROIC, EPS and dividend higher.
  • Staples: 'Just Walk Away, Rene'
    Mar. 13, 2014 SPLS 22 Comments

    Summary

    • The long-term looks problematic for Staples.
    • Remedial actions of store closings, layoffs, and pressure for lower vendor costs are indicative of decline in its business model.
    • The best time to invest in the retail sector is when SSS and new stores are growing, not contracting.
  • Southern Company: Investors Sigh Of Relief
    Mar. 10, 2014 SO 35 Comments

    Summary

    • Federal loans tip the balance towards Southern Company investors.
    • Current yield and compelling valuations make Southern Company a core utility holding.
    • Loan guarantees lower Southern Company's risk profile.
  • Exelon: 'Keep On Walkin,' Don't Look Back'
    Feb. 25, 2014 EXC 34 Comments
  • BGC Partners: Buying Cash, Stock, And Growing Commercial Real Estate Exposure
    Feb. 16, 2014 BGCP 12 Comments
  • Piedmont Natural Gas: Safe Small Cap Utility For The Next Market Meltdown
       • Feb. 12, 2014 PNY 36 Comments
  • A Few Reliable High Dividend Utilities
    Feb. 11, 2014 CPK, ETR, GAS 4 Comments
  • Is Niska Gas Storage Worth The Risk Of A 9.1% Yield?
    Feb. 3, 2014 NKA 4 Comments