October 25, 2010
If you're aiming to "buy low and sell high," then it makes infinite sense to start your search with bargain-priced stocks. Regularly reviewing a list of stocks trading near their 52-week lows can be a great first step.
Here, I'll try to do the initial legwork for you. To prevent us from being inundated with scores of disparate companies, I'll conduct my search by industry. This will allow us to make some initial comparisons among semi-related companies.
There are 24 industry groups as defined by the Global Industry Classification Standard (GICS). Utilities are one of them.
Below are the top five companies in this space (by market cap) that are hugging 52-week lows.
Market Capitalization (in millions)
% Change From 52-Week Low
P/E Ratio (trailing)
|Exelon (NYSE: EXC )
|Duke Energy (NYSE: DUK )
|Public Service Enterprise Group (NYSE: PEG )
|Korea Electric Power (NYSE: KEP )
|Entergy (NYSE: ETR )
Source: Capital IQ, a division of Standard & Poor's. Data as of Oct. 24.
Utilities offer the promise of some resistance to volatility and generally high dividend yields. Exelon, Duke, Public Service Enterprise, and Entergy all are yielding above 4%.
One thing to keep an eye on in this space is free cash flows. Because of high capital needs, free cash flow often lags earnings. That's the case with each of the four high dividend payers (on a trailing-12-months basis) above except Entergy.
If you are interested in reading more about these stocks, add them to My Watchlist to find all of our Foolish analysis on them.