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Stock Strategist Industry Reports

Utility Dividend Leaders and Laggards

In a post-pandemic world, most utilities’ dividends offer investors an attractive income alternative.

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Despite the headwinds posed by COVID-19, utilities continue to have strong growth prospects, healthy financials, and growing dividends. With many utilities trading slightly below our fair value estimates, investors have a rare opportunity for long-term capital gains and 5%-plus dividend growth. With the spread between utilities’ dividend yields and the 10-year U.S. Treasury yield near historic highs, utilities’ income characteristics have rarely looked better.

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Andrew Bischof does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.