Fortis Inc. (FTS.TO)

It falls into the category that it pulled back with the whole group they still have room to grow by acquisition. It is a hold for the dividend but he does not expect a lot of growth. It would be a buy a couple of dollars down.

The problem he has with utilities is that they are making acquisitions for growth, not organically. That is the 1st of a red flag. Interest rates are rising. This company's dividends have been going up roughly 7%. The company has been moving into the US so there are some currency issues. If you go with this, don’t make it a large holding.

This is her utility pick. The stock has pulled back to about $45, and has not participated in this recent rally. Made an acquisition about a year ago that expanded their presence in the US. Based on their backlog of projects in place, the company announced they can grow their dividend 6% through to 2020. Dividend yield of 3.8%. (Analysts' price target is $50.50.)

This has an impeccable dividend record. The longest consecutive dividend increases in Canada, going on 46-47 years. A utility that now owns more utility assets in the US than in Canada. This has lots of organic growth in front of it. He is hoping to see a short-term rise in interest rates, and maybe see the stock check back to under $40. If you can get it at over 84% yield, you can buy it all day long. That is where he would be looking to buy more.

What would you see as a bottoming price? Last summer, utilities were breaking down, compared to the market. He would be interested somewhere between $43 and $40. With rates pushing higher, there is going to be some impact. As this pro-growth rally keeps unfolding, we are going to see potential opportunities in those areas that are not working. He loves this stock. It is a well-run business.

This is in the crazy environment where they’ve gone straight up. It’s pretty hard not to like this stock. He can't see any reason why you should sell this.

Had a pretty good Q3 driven by their US operations and lower costs. Their developments are attracting well. Very solid dividend growth. Has a low Payout Ratio that supports the dividend growth. There are other projects outside their capital plan that can drive growth further. Not cheap anymore, trading at around 18.5X 2018, versus its peers at around 17X. It really doesn't have the best growth. He is only modelling 3% growth 2017-2019.

(A Top Pick Feb 1/17. Up 18%.) He likes this, but hasn't been buying it lately. His cost basis was normally around $40. They've very successfully diversified from just being a power producer to also being a power transmission system. Over the last 10 years they've made 2 really large acquisitions very successfully. Excellent management. There are exposed to different regulatory systems, but they have enough growth in assets going forward that there will be more free cash flow and higher dividends over time.

It is considered the most conservative of the utilities. He would not trade it based on short term weather conditions. It has $14 billion of projects planned for the next 5 years. They expect to raise their dividend 6% a year over the next 5 years. If you tack that onto their dividend you get 9.5% over a five year period,

EMA-T vs. FTS-T. He has a small preference or FTS-T. You have to be careful if you know higher rates are coming. In the US it is December and March and in Canada with maybe only one rise in 2018. You could see a 10-15% decline if they report flat earnings.

This is in the utility/infrastructure space. A good company and has seen pretty good growth over the last couple of months or so. In a rising interest rate environment, utilities would face some pressures, but this company has withstood that very well. This will continue to move along well, and pays a good dividend yield of 3.7%.

A lot of people are in this stock because of the great yield. It has been a consistent performer. If you are there for yield then you can hold it. If it sold off a bit and you bought it cheaper, and could get double digit returns, then he would have no qualms about it.

EMA-T vs. FTS-T. Utilities and rate hikes. Most of the calls around interest rates are for 1 more non-aggressive interest rate rise. It may not have as great a rise in utilities. They are doing what utilities have been doing recently – consolidating. You might see a slide down within the trading range. FTS-T has an uptrend, unlike EMA-T. It’s okay if both go sideways because you collect the dividend.

Has had 44 years in a row of dividend growth. Just announced a 6.25% increase, $1.70 a share. Our world is going to need electricity 44 years from now and this company has a wonderful installed base. 3.7% dividend yield.

(A Top Pick Oct 12/16. Up 14%.) An electric utility, so it is insulated from commodity exposure. She likes the US acquisition they did, which really expanded their presence in the US. 60% of earnings will be coming from the US. They’ve indicated they can increase their dividend by 6% annually until 2021.