Stability. With the economy slowing down and interest rates still riding high, there can be something said for having stability in a portfolio. And you can’t get more stable than the stocks of the utility sector. After all, people need to heat their homes and keep the lights on no matter what the economy is doing. As such, firms in the sector — like our latest Best Dividend Capture Stocks List pick — offer plenty of opportunity for profits and a growing dividend. And our pick has done so for nearly two decades straight!
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
Our pick’s stability comes from its operating area. The firm is one of the largest public utilities in Oklahoma. The region continues to be a hotbed of activity thanks to its vast energy resources. This has provided plenty of demand from manufacturers and an overall healthy state economy. For our pick’s electricity generation and transmission assets, this fact has resulted in plenty of steady cash flows and dividend growth for its shareholders.
Our pick has continued to grow in other areas as well. Like many utilities, our pick has started to add more renewables into its energy mix. The win is that our pick still has plenty of coal plants under its umbrella, which gives it a long tailwind for growth versus some other utilities that have already undergone the coal-to-renewables switch. At the same time, our pick has continued to undergo divestiture to make it an electricity-focused utility. Add in low-cost and abundant wind and natural gas resources to its main operating area, and you have a long runway for growth. A friendly regulatory environment doesn’t hurt either.
The result is that our pick has been able to become a top-notch utility with a long history of shareholder rewards.
With that stability, investors have taken notice. Our pick’s top position within the utility sector has made it a great dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Monday, July 8, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 5.1 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our electric utility pick could be a lucrative option.
