“Water purification companies fall into a large lump of highly regulated businesses known as utilities. While the utility sector is boring, shares of utility stocks have been lighting portfolios up in 2011. Utilities are one of the very few sectors that offer shelter during severe economic downturns. And utility stocks are considered defensive investments because they tend to perform well during difficult economic times. Also, earnings are stable since people will need electricity, gas and wastewater services all the time.
“Over the past 11 years, Aqua America, Inc. (WTR – yield 3.10%) has managed to increase its net income every single year. How many other companies can claim 11 years of consecutive income growth? Aqua America has raised its dividend payment 19 times over the past 20 years— that dividend has doubled from $0.30 in 2000 to $0.66 too. Next year, I expect Aqua America to continue its financial success. Sales are expected to increase 5.7% to $808 million and translate into $1.08 EPS for 2012. Currently, 13 analysts follow the stock and not one of them has a sell rating. Utilities offer a great investment for those who believe the market is overheating. Safeguard your portfolio with shares of Aqua America at any price below $24.50.”
Ian Wyatt, Top Stock Insights, January 2012
