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William Hurley, CFA Senior Equity Analyst

Utilities Sector. Regulated and Integrated Electric Utilities Gas Pipelines and Gas Utilities. William Hurley, CFA Senior Equity Analyst. Utilities Sector Performance. Utilities have outperformed the broad index on a 3-year basis. Indexed Total Return (1 Year and 3 Years).

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William Hurley, CFA Senior Equity Analyst

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  1. Utilities Sector Regulated and Integrated Electric Utilities Gas Pipelines and Gas Utilities William Hurley, CFA Senior Equity Analyst

  2. Utilities Sector Performance Utilities have outperformed the broad index on a 3-year basis. Indexed Total Return (1 Year and 3 Years)

  3. Regulated Utilities Performance The regulated utilities outperform in the first half of a recession. Indexed Total Return (1 Year and 3 Years)

  4. Regulated Utilities Dividend Yield The regulated utilities historically have yielded 80 basis points less than the 10-year Treasury. Right now, at 5.9%, they yield 260 basis points more. 10-Year Treasury Yield Versus Regulated Average Dividend Yield

  5. Integrated Utilities and Natural Gas Prices The integrated utilities have been roughly correlated with natural gas prices. Indexed Total Return (3 Years)

  6. Utilities Coverage and Themes Examples of Themes, Ordered by Exposure or Preference Coverage • Regulated Electric Utilities • PG&E (PCG) – 1/A • Southern (SO) – 2/A • Duke (DUK) – 2/B • Regulated Gas / Pipeline • Spectra (SE) – 1/B • Integrated Utilities • Entergy (ETR) – 1/B • Exelon (EXC) – 1/A • FPL (FPL) – 1/A • Dominion (D) – 2/B • Dividend Yield • PCG; SO • Renewables • FPL; PCG • Transmission • PCG?; EXC? (Watch for note soon.) • Natural Gas Prices • EXC; ETR; D; FPL • Carbon Legislation • EXC; ETR; FPL; D • Natural Gas Infrastructure • SE

  7. Alternative Energy Solar William Hurley, CFA Senior Equity Analyst

  8. Solar and Crude The solar companies are less correlated with crude, as it should be.

  9. Chinese Solar Versus First Solar The Chinese companies have run on lower polysilicon prices; operating leverage.

  10. Thank you. William Hurley, CFA Senior Equity Analyst

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