Yup, FirstEnergy (FE) is another electric utility, and as we’ve seen with this sector, ultra-low prices for natural gas and Fed taper anxiety are pressuring stocks this year.
As for FirstEnergy, shares are off more than 11% in 2013, but — on the bright side — that does make the dividend yield higher for new money, currently reaching a whopping 5.7%.
That said, FirstEnergy did have a lousy third quarter. True, earnings beat Wall Street estimates, but net income still plunged by almost half because unusually cool summer weather meant customers went without air conditioning.
The company also slashed its full-year guidance, which is never good for the share price, at least in the short term. That’s of no consequence to the dividend, however. Indeed, FE’s cash on hand increased to $222 million from $172 million at the end of last year.