The utilities sector is by definition boring. After all, demand for electricity, gas, and water is pretty steady. And because of that, the sector can hand back plenty of cash flows to investors as dividends. They really are the ‘widows & orphan’ stocks of the market.
Except when they are not. Lately, the utilities haven’t been acting like their historical selves. The group was largely ignored during the pandemic despite their safe nature. And now, post-pandemic, the group is being ignored for a number of factors. The potential of rising rates is just one reason.
However, investors may want to go against the grain when it comes to utilities.
The sector continues to evolve and transform. Meanwhile, we still aren’t out of the woods just yet with regard to the pandemic. That could mean that the sector’s safety and high dividend yields could be a major win for portfolios.
Explore all utility sector stocks, mutual funds and ETFs here.
