5 Utility Stocks To Brave 2016's Market Bugaboos

Our Choices

Under such circumstances, selecting stocks which have a low beta might be the right thing to do. Also known as beta coefficient, it measures the volatility of a stock in contrast to broader markets. So, it measures the extent to which a stock may be affected by market conditions. Low correlation stocks provide protection during turbulent times as they are less prone to day-to-day fluctuations.

This is why utility stocks, traditionally a defensive play, with a low beta may be a prudent choice at this time. We have narrowed down our search to the following stocks based on a good Zacks Rank and other relevant metrics.

SCANA Corp.’s (SCG - Analyst Report) operations include transmission, distribution, generation and sale of electricity to customers in South Carolina.  

SCANA has a Zacks Rank #2 (Buy) and has a beta value of 0.21. The stock has a dividend yield of 3.6%. The forward price-to-earnings ratio (P/E) for the current financial year (F1) is 15.43, lower than the industry average of 15.85.

Northwestern Corp. (NWE - Snapshot Report), which conducts its business as NorthWestern Energy, is an investor-owned utility and one of the largest providers of electricity and natural gas in the northwest quadrant of the U.S.

Northwestern Corp has a Zacks Rank #1 (Strong Buy) and has a beta value of 0.43. The stock has a dividend yield of 3.59%. The stock’s estimated growth for the current year is 8%.

WGL Holdings Inc. (WGL - Snapshot Report) is a public utility that delivers and sells natural gas as well as other services and products related to energy.

WGL Holdings has a Zacks Rank #2 and has a beta value of 0.58. The stock has a dividend yield of 2.99%. The stock has a PEG ratio of 2.73, lower than the industry average of 3.46.

Atmos Energy Corp. (ATO - Snapshot Report) distributes and sells natural gas to residential, commercial, industrial, agricultural and other customers.

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