Tuesday, January 2, 2018

Latest Buy - Dominion Energy Inc (D)

The utility sector has been lagging the overall market lately. One of the reasons might be the assumption that the recently passed tax reform will not help the utility sector as much as they would the other sectors.

While that might or might not be true, some of the utilities have given up some gains and as a result are off their recent lofty highs.


I took advantage of this weakness and opened a small position in Dominion Energy Inc (D) at $83.00 a share. The current dividend payout is $0.77 cent a quarter or $3.08 a year per share, giving me a starting yield on cost of about 3.71%.

It gets better though, just recently they established a 2018 dividend of $3.34/share. Since my first dividend will start with the new increased dividend rate, the yield on cost automatically goes up to 4.02%. Not too shabby.

Now, the stock price has since gone down some. I expect/hope for it to go down a bit more and intend to add more in the upper 70's if it gets there.

What do you think of this buy ? Are you looking at any utilities or any other stocks that present value right now?

6 comments:

  1. I don't know much about Dominion but will add it to my list to look at. Congrats on the buy, always nice to add a 4% yielder to the portfolio.

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    1. @Timeinthemarket - Thanks. Dominion is a solid mid-western utility. Just today, they offered to buy another utility company (SCANA) and the market reacted by sending it down some more.

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  2. Hi Desi Guy. I'm slated to become an shareholder of D later this year since I own shares of SCANA (SCG). 2017 was a rough year for SCG, so I'm glad to see most of the uncertainly surrounding it go away. I'll be researching D more in the coming weeks to determine if I want to hold out for the exchange. How has D treated you?

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    1. Hi @EngineeringDividends - thanks for the comment.
      Dominion energy is a new position for me, but since the time i have started following it, total returns along with the dividend payout has only gone up. It is a solid utility, i hope they haven't chewed off more than they should have with the SCG purchase :)

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  3. That's a good pick up. I like D a lot for the long haul and think it's a solid yield producing asset that belong in any DGI portfolio. SO and PPL also look interesting to me these days. Thanks for sharing.

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    1. @Keith - I hope D keeps the consistent dividend increases going for the near future.

      I agree about SO, it is almost at a 5% yield right now.

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