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EXC, FE, and PEG: A Look at Utilities’ Dividend Growth

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Dec. 27 2016, Updated 3:35 p.m. ET

Dividend growth

Exelon (EXC), the largest hybrid utility by market capitalization, has posted dismal dividend growth rate in the last five years. Exelon trimmed its quarterly dividends from $0.525 per share to $0.31 per share in 2Q13. EXC increased its dividends 2.6% in 2Q16.

In comparison, Public Service Enterprise Group’s (PEG) dividend growth rate in the last five years was 4% compounded annually.

DPS

FirstEnergy’s (FE) dividends fell 13% annually in the last five years. In 2014, FE cut its quarterly dividends from $0.55 per share to $0.36 per share.

Hybrid utilities have focused on cash retention instead of distributing cash as dividends in the last few years. Lower wholesale power prices and increasing operational costs squeezed the operational cash flows of these utilities.

You can learn more about dividends of the three largest utilities in DUK, SO, and NEE: Which UtilityPays the Highest Dividend?

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