3 Reasons to Buy Duke Energy Today

Historically, tumultuous times offer some of the best opportunities to buy stocks, and the market's recent mess surely qualifies. And though energy firm Duke Energy (NYSE: DUK  ) has made good progress in recovering from the recession, many investors expect even better times ahead.

In our Motley Fool CAPS community, about 95% of the 1,822 investors rating the company are bullish, so there's no shortage of reasons why Duke Energy will thrive, three of which I've highlighted below.

But here at The Motley Fool, we're all for looking at both the good and bad sides of an investment. Once you're done with this article, you can read the case against the stock, weigh in with your own comments below, or rate Duke Energy yourself in CAPS.

1. Improving outlook
Aside from a $660 million noncash writedown on some assets in the Midwest, Duke Energy put up a strong second quarter, with adjusted earnings per share blowing past analysts' expectations. And similar to the increased outlook from peer Exelon (NYSE: EXC  ) , Duke is bullish on the rest of the year as it bumped up its full-year adjusted earnings-per-share outlook. Some CAPS members think the improving operations help it stand out among peers.  

2. Investing in the future
Smart-grid initiatives may have a way to go, but Duke has been making some significant moves in the space. It recently partnered with Cisco Systems (Nasdaq: CSCO  ) to set up a smart grid among office buildings in North Carolina and is working on a $400 million smart grid initiative with Echelon (Nasdaq: ELON  ) and Ambient in Ohio. And with Duke's other initiatives in renewable energy, some CAPS members like the company's efforts to embrace new trends early rather than falling behind.

3. Dividend
Many investors love a good dividend from a strong utility stock. And Duke Energy's 5.5% yield sits well among those of its peers like Progress Energy's (NYSE: PGN  ) 5.6%, Southern Co.'s (NYSE: SO  ) 4.9%, and PPL's (NYSE: PPL  ) 5.1%. Duke's dividend alone has made it a popular stock among CAPS members, with many banking on its strong yield to continue adding to its potential returns.

To see details of what CAPS members are saying now about Duke Energy, just click on over to Motley Fool CAPS and have a look -- or add your own thoughts directly to this story in the comments box below.

The Motley Fool Stock Advisor service looks for companies with strong management poised to beat the market over the long haul. To see all the stocks that have helped Tom and David Gardner beat the market by 72 points on average, take a free 30-day trial.

Fool contributor Dave Mock can easily think of three reasons why sugared cereal should be withheld from the kids under certain circumstances. He owns no shares of companies mentioned here. Exelon is an Inside Value choice. Duke Energy and Southern are Income Investor selections. The Fool has written calls (bull call spread) on Cisco Systems. The Fool owns shares of Exelon.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Fool's disclosure policywould be an energy drink fiend were it not for the twelve step program.


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