Scana, Westar Are Highly Rated Utilities That Pay Dividends

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With market conditions getting rocky, utility stocks (seen as defensive issues) have outperformed in recent weeks.

The Utility-Electric Power group, which jumped to 70 in Monday's IBD, gained 3.7% in the past four weeks vs. a 1.7% drop in the S&P 500. The Utility-Diversified group was No. 83, gaining 3.1% in the past four weeks.

Scana ( SCG ) andWestar Energy ( WR ) are two highly rated issues with respectable yields in the diversified and electric utility groups.

Scana, a Cayce, S.C.-based diversified utility, provides electricity and gas in North Carolina, South Carolina and Georgia. The firm has had some bumpy spots in earnings in recent years, but has mostly been able to deliver single-digit gains in its bottom line.

The stock has a five-year Earnings Stability Factor of 3. The gauge runs from 0 (stable) to 99 (wild).

The company pays 52.5 cents a share each quarter, or $2.10 on an annual basis. It has a yield of about 4.1%, which is more than double that of the S&P 500.

Scana's stock is near an eight-month high after recently clearing a 50.98 buy point from a handle in a long saucer base. The saucer formed next to a flat base.

The company will report first-quarter results April 24.

Westar Energy is the biggest provider of electricity in Kansas, serving almost 700,000 commercial, industrial and residential customers. Even though utilities aren't known for growth, Westar's earnings rose 1% to 41% in the past five years.

It has a five-year Earnings Stability Factor of 8. Profit is expected to rise 3% to $2.34 a share this year.

In late February, Westar raised its quarterly dividend by a penny to 35 cents a share. At the new quarterly rate, it pays $1.40 a share, which works out to a yield of about 4%.

Westar broke out from a cup-with-handle base in February and has formed a flat base with a 35.34 buy point.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: SCG , WR

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