I have a slight gas problem. Let's discuss it like adults. After all, I'm only heeding Peter Lynch's famous reminder to look around our own households for investment ideas, and during these chilly days, as the furnace runs, Nicor (NYSE:GAS) is on my mind.

Nicor gives me gas or, rather; I pay a hefty premium, into three digits these days. That's why it seems like a heck of a business to me: guaranteed demand no matter what it charges. No competition. The company only sends a meter guy six times a year, and in-between makes a large overestimate that allows it to collect interest on my prepayment until things are adjusted the next month. What's not to love about a toll bridge like that?

Well, it's boring, and, as today's release shows, the numbers don't always go up. For fiscal 2003, Nicor's earnings dropped to $2.38 per share or, adjusting for an accounting change, 13.8%. The loss came despite a 40% increase in operating revenues. The fiercest money-eating monster was the cost of gas, which was 72% of gas sales in 2003, vs. 61% last year.

But Nicor has other cards up its sleeve. For instance, it runs a little container-shipping outfit called Tropical Shipping that contributes 10% of continuing revenues but offers higher operating margins than the utility business.

Trading at about 12.4 times trailing earnings and 15 times forward estimates of $2.30, Nicor looks competitively priced compared to peers such as Exelon (NYSE:EXC) and Peoples Energy (NYSE:PGL). Factor in a good return on equity, a steady earnings history, and a hot 5.7% dividend yield, and the company looks even better. With a lot of stocks appearing overheated these days, a stodgy, old moneymaking utility looks like a cozy place to stash some cash.

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Seth Jayson owns no shares of any companies mentioned here, but he's got his eye on Nicor.