When it comes to dividend paying ability, utility stocks have historically been a top-notch play for investors. These bond proxies offer steady cash flows that support high dividend yields. It’s no wonder why they call them widow and orphan stocks. But some utilities also offer plenty of growth potential. This includes our latest Best Dividend Capture Pick, which has provided both serious income and earnings growth throughout its history.
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
Our pick isn’t just a utility. It’s a mega-sized one with over nine million customers, covering six different states. Its operating area happens to be in the fast growing sunbelt. This region continues to support strong economic conditions and population growth. Moreover, our pick doesn’t just provide one service. It has both electricity and natural gas operations. The combination of size and multi-asset scope has continued to generate plenty of cash for its bottom line.
But our pick isn’t just a boring cash-flow play. It has growth as well. Rising renewable and green energy generation has allowed our pick to generate extra cash flows. Meanwhile, our pick is a top nuclear player. After years of construction, two new reactors in its fleet are now online. This has allowed it to produce extra cash flows. With nuclear power now getting the nod once again from regulators, our pick has plenty of potential to grow. Meanwhile, natural gas operations and pipelines are quickly becoming cash flow giants of their own.
The combination of a strong customer base and growth has our pick being a great dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Friday, February 16, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 5.6 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our latest utility stock could be a lucrative option.