Emera Inc (EMA.TO)

Utilities are out of favour and he owns none now, but he has owned and liked EMA in the past. Yields above 6% which can grow further. Problem is that if rates stay high for longer, shares will decline, though the yield would climb to 7%. He is watching utilities and he will eventually peck away at utilities.

Strong commodity without the problems of other companies in sector. Very stable business that has exposure to interest rates - but continues to execute well. 

It has struggled and has more debt than others in the sector. He is expecting them to sell off some of their assets which should help, along with rate cuts. The dividend is safe. It is at a good entry point.

Return on capital predictable, but replacement cost of assets very high. Good for defensive investors, but not going to appreciate capital at high rate. Lots of capital required to grow business creates situation of low returns. Politicians and consumers putting pressure on margins of business. Falling interest rates good for the business (high debt load in business). Overall, better options for investors out there. 

Could hold for dividend. Technically, can't argue with the downtrend. Hopefully, stock will find support around $45. If yes, there's consolidation and maybe downtrend is over. Wouldn't jump all over it, there's perhaps hope if doesn't break $45.

Editor's Note: The question was on utilities and her response included Fortis and Emera. Utilities are lower volatility in the long term and come with a nice yield. There is more growth ahead that we haven't seen for the past 5 to 10 years. Rising rates give a better ROE. She likes Fortis and Emera with Emera showing a little more growth and a yield of 6%.

It is a different company now with more assets in the U.S. than in Canada. In Florida they can ask for higher rates just based on its population growth. They are targeting 7% rate-based growth and 4 to 5% dividend growth. It is defensive in nature and there is a big opportunity because of its very low valuation.        Buy 8  Hold 6  Sell 2

All utilities have seen share prices fall since the spring, being bond proxies given rising interest rates. People are buying bonds, and selling utilities. Now is a good entry point at 15x PE, and pays over a 6% dividend yield, which has grown 17 straight years. Low risk, because 95% of their business are regulated and there's little cyclicality (recession-resilient).

All energy stocks, from renewables to this one, are down. Pays a roughly 6% dividend, and it's safe. Generally, you can start to buy these. It's all about interest rates, which continue to rise. Dividend stocks are competing with GICs and other bank deposits offering 6% yields. Doubts that any utilities will cut dividends, but the share prices may come down further. You can buy a tranche, cautiously.

Great Canadian company.
Hard assets, but current share price too high.
Waiting for share price to fall ~$10.
Very safe dividend. 

Electricity demand in North America continues to rise. Emera will sort out issues in Nova Scotia. Their New Meico and Tampa centres are growing, needing more electricity. It pays over a 5% dividend.