7 Jan

Utilities versus Broader Markets’ Total Returns

WRITTEN BY Vineet Kulkarni

Total return

Utilities played out well last year amid broader markets’ volatility. The utilities, including dividends, returned more than 6%, while the S&P 500 returned -6% last year.

Utilities generally have stable earnings due to their low-risk and regulated operations. Investors usually turn to utilities during uncertainties due to their slow and stable stock price movements and high dividend payments. Currently, utilities yield 3.3%, which is notably higher than broader markets.

Utilities versus Broader Markets’ Total Returns

Utilities (XLU) (IDU) didn’t just beat broader markets last year. They have outperformed the S&P 500 in the past three and five years as well. In the last five years, utilities returned 68%, while the S&P 500 returned 52%. The total return considers the capital appreciation and dividends paid in a particular period.

Regulated utilities Southern Company (SO) and PPL (PPL) offer a dividend yield of 5.4% and 5.9%, respectively. Both of the utilities lagged their peers in terms of total returns in the last few years. To learn why these top-yielding utilities failed, read Southern Company’s Total Returns Compared to Its Peers.

Latest articles

19 Jul

Afya's IPO Sees Strong Listing Gains

WRITTEN BY Mohit Oberoi, CFA

Afya (AFYA) listed on the Nasdaq Global Select Market on July 19. The company priced its IPO at $19 per share.

19 Jul

What to Watch For in Amazon's Q2 Earnings

WRITTEN BY Sanmit Amin

e-Commerce giant Amazon (AMZN) is scheduled to report its second-quarter earnings results after the closing bell on July 25.

19 Jul

Barrick Gold Reaches Deal to Buy Acacia Mining

WRITTEN BY Anuradha Garg

After a long standoff, Barrick Gold (GOLD) and Acacia Mining (ABGLF) have reached an agreement.

19 Jul

Comcast Shares Pop on Goldman's Optimism

WRITTEN BY Ruchi Gupta

Comcast (CMCSA) shares popped after Goldman Sachs issued a positive note on the company recently. Goldman upgraded its rating for Comcast to "buy" from "hold."

19 Jul

Why Analysts Are Bearish on Netflix Stock

WRITTEN BY Aditya Raghunath

Netflix stock fell over 10.0% on Thursday and is down 0.5% today as well.

On Thursday, pet retailer Chewy (CHWY) reported its first-quarter results after the market closed. The company reported its earnings for the first time.