Monday, January 31, 2011

Natural Gas Smells of Dividend Growth

Natural Gas Smells of Dividend Growth

Utilities are not exciting stocks, and will not make you rich. But keeping a select few in your portfolio can add a level of stability and income that is hard to match in equities. A strong regional monopoly paired with a heavily regulated industry that requires massive capital investment basically assures the longevity of the company.

But where utilities often come up short is in inflation-beating growth, especially among dividends. Dividend growth of 1-2% a year is just not going to cut it. But these four natural gas utility companies are growing their dividends above the average inflation rate (3% based on CPI) and helping investors keep their purchasing power.

Northwest Natural Gas
Northwest Natural Gas Company (NYSE: NWG) is engaged in the distribution of natural gas in Oregon and southwest Washington. WNW Natural operates in two primary reportable business segments, Local Gas Distribution and Gas Storage.
5 dividend growth - 4.85%
Current yield - 3.84%

Natural Gas Fuel Company
National Fuel Gas Company (NYSE: NFG), incorporated in 1902, is a diversified energy company with its headquarters in Williamsville, New York. The Company's assets are distributed among four business segments: Exploration and Production, Pipeline and Storage, Utility and Energy Marketing.
5 year dividend growth - 3.64%
Current yield - 2.02%

Piedmont Natural Gas
Piedmont Natural Gas Company, Inc. (NYSE: PNY) is an energy services company. The Company is engaged in the distribution of natural gas to over one million residential, commercial, industrial and power generation customers in portions of North Carolina, South Carolina and Tennessee, including 61,000 customers served by municipalities who are its wholesale customers.
5 year dividend growth - 3.93%
Current yield - 3.93%

Energen Corporation (NYSE: EGN) is an energy holding company engaged in the development, acquisition, exploration and production of oil, natural gas and natural gas liquids in the continental United States, and in the purchase, distribution and sale of natural gas in central and north Alabama.
5 year dividend growth - 4.26%
Current yield - 0.96%

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