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TMFLegendPhoenix (< 20)

It surrounds us and penetrates us. It binds the galaxy together.

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August 10, 2011 – Comments (1) | RELATED TICKERS: D , POM.DL , AEP

For my first "stock of the week," I tried to consider which stocks would have relatively low volatility during this tumultuous economic climate.  My goal was to find a company that provides a service or product that people really need or, better yet, has their customers committed into paying a monthly bill and they do so happily.  Preferably, this company provides good reliable service, pays a handsome dividend and has a positive, long-term economic outlook.  So after work, I scurried through the heat wave to my over-air conditioned home to try to come up with a company that fit as many of these criteria as possible.  Finally it hit me:  from the eccentric astrodroid to the lowly moisture farmer to the ruthless crime lord, everyone needs it.  No, I'm not referring to some mystical energy field that controls our destiny, I'm talk about power. Specifically I'm talking about Dominion Resources.
 
This Richmond, Virginia-based company has been around for about as long as Yoda has been training Jedi and they've been in the electric business for over 100 years.  They currently serve more than 5 million retail energy customers and they have rewarded their investors with 334 consecutive dividend payments.  The current majority of their electric production comes from coal (46%) and nuclear (41%), but they have begun construction on a natural gas processing plant in West Virginia and they continue to grow their renewable energy sources from wind, hydro and biomass. 

As a Dominion customer, I have experienced very good service from them getting a person on the phone, getting someone to come out to my house, setting up new service and they are pretty good servicing outages (as compared with the utility across the Potomac, PEPCO).  There are other electric utilities that could be a wonderful investment opportunity (Southern Company, the American Electric Power Company and the aforementioned Pepco Holdings Inc.), but I have this warm feeling that every time I pay my electric bill, some miniscule portion of my payment will be returned to me in the form of a dividend. 

 

I'll leave you with a question posed by a wizard who's just a crazy old man, "Who's the more foolish? The Fool, or the fool who follows him?"

1 Comments – Post Your Own

#1) On August 11, 2011 at 2:53 AM, TMFLegendPhoenix (< 20) wrote:

I plan to post another "stock of the week" blog entry very soon so I felt I should point out that this pick of Dominion was made last week, as I purchased it on Friday August 5th @ $48.15.  I'm a little behind (I've never done a blog of any kind before) and I expect to be all caught up by next week.

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