Utilities are on fire. As boring as they may be, stocks in this sector have been climbing higher and higher in 2016, thanks to one major trend: investors are desperate for yield, but they don’t want risk. With many high yielding assets coming with high risk, investors are looking for safety, and utilities are seen as a safe alternative. As U.S. Treasuries hit historical lows and corporate bond yields slide further, utilities become a huge attraction.
It’s not easy finding utility stocks with a wide moat, good dividend coverage, and limited price growth in the last year. But the market has still overlooked some true gems with strong and growing operating margins and solid dividend coverage. So which should you buy? Read on and find out: My first pick to buy is FirstEnergy Corp. (FE), a utility stock yielding 4% that is up just 4% in the last year. My second stock to buy is a natural gas pure-play: AmeriGas Partners, L.P. (APU), a limited partnership with an impressive 8% yield.
Source: InvestorPlace
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