Under the Radar: South Jersey Beats Market

The company's shares have lost 3.4% in the past year, less than the 10% drop in the S&P 600 Utilities Index. The stock has climbed by more than 10% every year since 2002.

Still, the small-cap utility is undervalued. South Jersey Industries trades at a price-to-earnings ratio of about 12, a 17% discount to the S&P 500 Index and a 9% discount to the average gas provider. The stock offers a hefty 3.4% dividend yield.

Investors seeking a play on cheap, natural gas and stable dividends should consider South Jersey Industries. We rate the stock "buy" with a grade of A-minus.

TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.