Seeking Alpha

Barclays likes Dominion Resources' prospects in 2014

  • Looking for a utility play to usher in the new year? Barclays recommends Dominion (D -0.2%).
  • "The core electric utility in Virginia is a premium business ... and grows at above-average 5%-plus rates with a clear regulatory path for four years," Barclays says, adding that "the midstream business is growing even faster, at 28% LTM Y/Y with an announced MLP offering in 2014."
  • Price target is $73.
  • D is the firm's only utility pick for 2014.
Comments (4)
  • rgperrin
    , contributor
    Comments (768) | Send Message
     
    The above news from Barclays is really nice for a shareholder to hear. Yesterday, however, I just received my monthly copy of "Kiplinger's Personal Finance Advisor," and Dominion resources is numbered among the five stocks discussed under the heading, "5 Stocks to Sell."

     

    The apparently problem is that this stock (and the others named) "appear[s] to be struggling to keep up the disbursements." That is, of course, about the last thing an investor in presumably safe utility stocks wants to hear. To rephrase the inimitable George Bernard Shaw, "Who can decide what to invest in when experts disagree?"
    10 Dec 2013, 04:33 PM Reply Like
  • hemiford
    , contributor
    Comments (18) | Send Message
     
    I have been long D for 15 years now in their DRIP which I bought on a whim since they are my power company and the regulated utility environment in Va has been good to them. What has my interest now is Cove Point and the LNG exporting coming online soon. The capex for replacing coal plants and modifying Cove Point to export have been huge and explains the "struggling to keep up with disbursements". I haven't seen how they plan on spinning off this MLP for the gas business but I will probably keep both and expect to see the TTM P/E drop like a rock once the gas exports come online.
    10 Dec 2013, 10:13 PM Reply Like
  • Holthusen
    , contributor
    Comments (639) | Send Message
     
    I strongly agree with your reference to the planned Cove Point LNG export facility as a future source of excellent profit stream for this large utility. I began building a long position in this stock a year ago in hope they would receive the recent permit for LNG export.
    11 Dec 2013, 06:10 AM Reply Like
  • Scooter-Pop
    , contributor
    Comments (2106) | Send Message
     
    Holt,

     

    When will D start trading the planned MLP?
    11 Dec 2013, 06:50 AM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Tools
Find the right ETFs for your portfolio:
Seeking Alpha's new ETF Hub
ETF Investment Guide:
Table of Contents | One Page Summary
Read about different ETF Asset Classes:
ETF Selector