Sunday, April 03, 2011

Utility Stocks that Increased Dividends

Income investors like the dividends they receive from gas and electric utilities, but they love dividend increases. If investors reinvest their dividends, then compounding can be significantly greater when the dividends are rising. In the last couple months, a few of the top yielding utility stocks listed at boosted their dividend payouts.

For example, the Arizona based electric utility, UniSource Energy Corporation (UNS), bumped up its quarterly dividend to $0.42 a share, an increase of 7.7%. The stock trades at 13 times forward earnings and has a yield of 4.7%.

WGL Holdings, Inc. (WGL) is an Eastern US natural gas distributor that serves Maryland, Virginia, Delaware and the District of Columbia. The company is now paying a quarterly dividend of $0.3875 per share, up 2.6% from its previous payout. The stock has a forward price to earnings ratio of 16 and yields 4.1%.

For investors looking for diversification, the Reaves Utility Income Fund (UTG) is a closed end fund that trades on the NYSE American Stock Exchange. The fund increased its monthly dividend by 8.7% to $0.125 per share, giving a yield of about 5.6%. This is the fifth dividend increase since 2004.

To access a free list of all the top yielding electric and gas utility stocks, which can be downloaded, sorted, and updated, go to

Disclosure: Author did not own any of the above at the time the article was written.


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