Entergy Corporation – Best Long-term Utility Stocks
In the month of October 2021, utility stocks have been on an uptrend. Just have a look at the iShares US Utilities ETF named IDU. The chart will show a strong up move starting October 1. The longer-term monthly chart also looks interesting. It has given a consistent upward move since 2009. There have been pullbacks along the way, but the move looks to have played out within a clearly defined channel. Utilities have been in the news lately because of rising commodity prices and coal shortages. There is a fear in certain countries that blackouts could disrupt the economy in the short term. The utility industry is an interesting space to be in because it is undergoing a major transition due to a shift towards renewable energy. If you are looking for the best utilities diversified stock in 2021, then you will definitely want to consider the sustainability credentials of any shortlisted companies.
Entergy Corporation Serving the Deep South
Entergy Corporation is a utility company focused on the southern states of Texas, Mississippi, Arkansas, and Louisiana. It has to deal with weather events like hurricanes and tornadoes, especially in Texas and Louisiana. Such weather events are a challenge for every utility business as it disrupts infrastructure and operations. However, outside of those risks, the utility business is quite stable. States usually regulate prices that the companies can charge their customers for energy consumption. The majority of Entergy’s customers are electricity consumers. Less than 10% of the customers account for gas consumption. Low-interest rates have helped utility companies as their dividend yields get impacted by the movements in interest rates. If you are looking for best long-term utility stocks, then make sure you look at the trend in the dividend payouts.
The dividend per share number at Entergy Corporation has been quite stable throughout the last decade. It was $3.32 in 2011 and has hovered around that level for the most part. The dividends went up to $3.74 in 2020. The gross margins in recent times have been above the 38% level.