In the first quarter of 2014, Canadian Utilities, or CU, earned an adjusted $186 million, or 71 cents a share. This was up marginally from adjusted earnings of $180 million, or 70 cents a share, a year earlier. This year's adjusted earnings exclude rate adjustments and dividends on preferred shares.
Include these and CU's earnings attributable to shareholders jumped to $221 million. That was up by nearly 21 per cent from earnings attributable to shareholders of $183 million, a year earlier.
The higher earnings rewarded CU for ongoing capital investment. It "invested $506 million in electricity and natural gas transmission and distribution facilities to support the continuing growth of [Alberta] and replace aging infrastructure." CU should earn more in all of 2014. That's because it plans to continue to invest about $500 million each quarter.
CU remains a buy for long-term gains and attractive dividends that it has raised for 42 years in a row. That would make CU a 'dividend aristocrat.' or among the best oil and gas stocks to own, even by the more stringent requirement of the U.S.-dividends up for at least 25 years in a row.
TSX-CU; Rating: Very Conservative; Sector: Utilities; Dividend: $1.07; Yield: 2.7%; O/S shares: 262 million; MRI: 6.5; MGI: 0.4; Five-year return: 125%; 52-week range: $41.68-$33.47; Net recourse debt-to-cash-flow: 3.2; ROE: 13.8%; Atco Ltd. controls; T: 403-292-7502; www.canadianutilities.com.
The Investment Reporter, MPL Communications Inc.133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846