Dominion Resources (D) — Once known solely as an electric power utility, this company has transformed itself over the past 10 years into one of the largest producers and transporters of energy in the United States. It operates one of the biggest underground natural gas storage systems in the country.
Credit Suisse notes management has supported 5%-6% EPS growth with new solar investments, legislation enacted by the Virginia state legislature establishing a long-term program to underground 4,000 miles of power lines, and an increase in pipeline work.
Q1 EPS came in at $1.04 versus a consensus forecast of $0.97. The company reaffirmed fiscal year 2014 guidance of $3.35-3.65 per share. Credit Suisse increased its price target to $76 from $69.
The stock is in a defined bull channel with the bullish support line just below its 50-day moving average. This line has historically been an excellent place to buy the stock or add to current holdings. And note the upturning MACD indicator, which has also often signaled it’s a good time to buy this stock.
Buy D as a long-term growth utility holding. The company pays an annual dividend of $2.40 for a 3.4% yield, and it has a history of regular dividend increases.