A portfolio of stocks I've been building since September 3 is named Volio. It will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!
Today I'm reviewing the fifth of five utilities sector stocks striving to join my Volio folio. This could be the fifteenth pick for Volio!
Now the utilities sector includes seven industries all geared to delivering water, gas or electricity or all three to us consumers. Utilities industries are: diversified; independent power producers; regulated electric, regulated gas; regulated water; renewable.
My subject today is a mid-cap diversified utility, named South Jersey Industries Inc. Their trading ticker symbol is SJI. This is my first ever report on SJI.
South Jersey Industries Inc, formerly SJI Inc is a New Jersey holding company that acquires and develops utility companies.
Through its many subsidiaries, SJI is primarily involved in transmitting, distributing, and selling natural gas and electricity in the mid-Atlantic U.S. The company segments its operations into gas utility operations and energy group businesses.
'The majority of SJI's total revenue comes from its gas utility operations, which encompasses the company's principal subsidiary: South Jersey Gas. SJG purchases, transmit and sells natural gas primarily for residential consumers in southern New Jersey.
The energy group also represents a significant income stream through its wholesale energy and retail electric services.
Additionally, it owns oil, gas, and mineral rights in the Marcellus Shale region of Pennsylvania; acquires and markets natural gas and electricity to retail end users, as well as provides total energy management services.
South Jersey Industries, Inc. was founded in 1910 and is headquartered in Folsom, New Jersey.
I use three key data points to gauge dividend-paying equities or funds like South Jersey Industries Inc:
(1) Price
(2) Dividends
(3) Returns
Besides those three, several other keys will finally unlock an equity or fund in which to invest, or not.
Those three basic keys, however, best tell whether a company has made, is making, and will make money.
SJI Price
South Jersey's price per share closed at $31.34 yesterday. A year ago its price was $30.21. So, in the past year, its price moved up $1.13, about 3.75%.
Assuming South Jersey's stock trades in the same range of $28 to $34 this next year, it's recent $31.34 price could rise by $2.66 to reach $34.00 by early-December, 2020, assuming some upward price momentum continues.
SJI Dividends
South Jersey's latest declared quarterly dividend was $0.295 per share payable December 27th.
That $0.295 Q dividend equates to $1.18 annually and yields 3.77% based on yesterday's $31.34 closing price.
SJI Gains?
Adding the $1.18 annual estimated dividend to my $2.66 optimistic estimate of South Jersey's price upside shows a $3.84 potential gross gain, per share, which will be reduced by any costs to trade these shares.
As, for costs, a little under $1,000.00 invested today in South Jersey Industries Inc at its recent $31.84 price, would buy 31 shares of SJI.
A $10 broker fee paid half at purchase and half at sale could cost us about $0.32 per share.
Subtract that $0.32 brokerage cost from the estimated $3.84 gross estimated gain per share leaves a net gain of $3.52 X 31 shares = $109.12 or a 10.9% net gain on a $987.04 investment.
Therefore, South Jersey Industries Inc, whose trading ticker symbol is SJI shows a possible 10.9% net gain including a 3.77% dividend yield. It could be more, it could be less.
The above speculation is based on past year performance. The actual results remain to be seen to learn if South Jersey Industries Inc, is worth your time and money.
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