Dividend Stocks

[gfp927z]

>>> Consolidated Edison -


http://www.kiplinger.com/slideshow/investing/T018-S015-5-safe-dividend-stocks-to-buy-for-retirement/index.html?rid=SYN-yahoo&rpageid=16183&yptr=yahoo


Dividend yield: 3.8%

Well, if nothing else, Consolidated Edison, Inc. (ED) gets my mom’s stamp of approval: She has owned the dividend stock in her retirement portfolio since 1980.

ConEd primarily serves New York City and most of its northern suburbs, and has been around since 1832. Today it delivers gas, electric and steam service (think radiators) to more than 10 million customers, generating nearly $13 billion in revenue for 2016.

New York and its suburbs continue to grow in population, housing starts are up, NYC is still home to a multitude of corporate headquarters locations, and tourists still flock to the Big Apple in droves. But ConEd isn’t simply resting on what the New York area has to offer.

To start, ConEd is working to find ways to produce cleaner energy that costs less for it to produce, like a customer-centric program in Brooklyn and Queens that’s helping to provide customers with incentives to lower costs instead of needing to build a $1 billion substation. ConEd is also building out an Advanced Metering Infrastructure program — a smart meter technology that will help identify local power generation problems and possible power outages more quickly for customers, allowing ConEd to administer services more quickly.

What ConEd lacks in size — for comparison, Duke Energy Corp. (DUK) runs at about $23b per year — it makes up for in steady net income of just over $1 billion per year over the past few years, and grown profits for the past three years. Steadier still is ED’s operating cash flow of over $3 billion — a tidy sum considering its $12 billion in revenue.

ED’s payout ratio is nearly 65%, but for a utility company, that’s not terribly high. Southern Co. (SO) and Duke Energy clock in above 80%. So ConEd has a bit more room to improve its dividends. Indeed, Consolidated Edison has increased earnings for 42 consecutive years, including a 3% hike recently to 69 cents

<<<