6 Utilities to Light Up a Portfolio

NEW YORK (TheStreet) -- The AES Corp. (AES), Calpine (CPN), Covanta (CVA), Spectra Energy (SE), NRG Energy (NRG) and UGI (UGI) are six utility stocks that have 30% mean upside potential based on 12-month price target, according to analysts.

Sixty-two percent of analysts polled by Bloomberg affirm a buy rating for these stocks. Investors can also consider The Southern Company (SO), Duke Energy (DUK) and Dominion Resources (D), which have appreciated 11% to 14% in the last year, however, these stocks have limited upside potential, as per analysts.

6. UGI (UGI) distributes and markets energy products like natural gas, propane and butane, besides generating electricity.

Net sales for the second quarter of 2011 were $471 million, up 18.7% from $396.6 million in the year-ago quarter. Net loss stood at $7.2 million, vs. $3.4 million profit in the same quarter prior year as the weather nationwide was slightly warmer than normal.

On the third-quarter results, Lon R. Greenberg, CEO of UGI, said, "Improved results from our Gas Utility and AmeriGas were not enough to offset an $11.3 million decrease in earnings from our International Propane businesses resulting principally from extraordinarily warm spring weather in Europe."

He further added, "Given the negative impact of International Propane's results on our quarterly and year-to-date earnings, as well as our current assessment of business prospects for a seasonal loss in the fourth quarter, we now expect earnings per share of approximately $2.2 for the full fiscal year ending Sept. 30, 2011." The stock is trading at 12.7 times its 2011 earnings with an estimated 18% upside over the next 12 months, according to a consensus of analysts polled by Bloomberg. The company has buy ratings from 50% of analysts polled.

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