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Six Electric Utility Stocks with High Oil / Gas Exposure

by: Stockerblog August 18, 2008 | about stocks: CNL / ETR / LNT / OGE / PNW / WR    

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One way to analyze electric utility stocks is to look at what types of fuel they use to run their generators, and how much exposure to oil and natural gas that they have. If you believe the price of oil and gas has peaked and will continue to drop, then it may be time to take a close look at the electric utility stocks with the highest usage of these fuels.

Pinnacle West Capital Corp. (PNW) has one of the heaviest exposures, with 24% of their electric energy coming from oil and natural gas. About 35% comes from coal and 21.5% from nuclear. This Phoenix, Arizona based company has a PE of 10, a PEG of 3.55 and a yield of 6%.

Westar Energy Inc. (WR) generates about 34% of its energy from natural gas, with 56% from coal and 9% from nuclear. This utility which serves Kansas has a PE of 13, a PEG of 3.28 and a yield of 5%.

Entergy Corp. (ETR) has about 18% of its fuel sources coming from oil and natural gas. 12% is from coal and 33% from nuclear, with the rest purchased. Entergy serves Arkansas, Mississippi, Texas, and Louisiana, including the City of New Orleans, where it is based. The stock has a PE of 16, a PEG of 1.19 and a yield of 3%.

OGE Energy Corp. (OGE) has 29% of its energy coming from natural gas, with 51% from coal. They serve the south central United States. The stock has a PE of 13, a PEG of 3.15 and a yield of 4.2%.

Alliant Energy Corp. (LNT) has 28% of its electricity generated from natural gas and 6% from oil. The company serves Iowa and southern Minnesota. The stock has a PE of 9, a PEG of 2.45 and a yield of 4.1%.

Cleco Corp. (CNL), another Louisiana based company, with 14% exposure to natural gas. The stock has a PE of 12, a PEG of 1.09 and a yield of 3.5%.

If you like utility stocks, you should take a look at Highest Yielding Electric Utilities and Highest Yielding Natural Gas Utilities. You can also find an Excel database of utility stocks, which you can download, add to and sort, at WallStreetNewsNetwork.com.

Disclosure: Author does not own any of the above.

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This article has 2 comments:

  •  
    Aug 19 07:49 AM
    Be careful - its not that simple. Many of these utilities have fuel clauses in which they pass the costs of generation directly thru to customers. PNW only keeps a portion of its fuel savings, WR has almost zero impact. LNT sees a benefit, but if gas prices dip toooo low they may be forced to refund some of the savings to customers, with interest.
    Reply
  •  
    Aug 19 04:47 PM
    where is pseg &clp in all this?thanx
    Reply
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