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Somehow, the hunt for boring utility stocks -- once easier than target practice -- has gotten almost exotic.

The safe utility investment of old, promising a steady if modest rate of return, seems to be virtually extinct. Even longtime industry stalwarts, such as

Dominion

(D) - Get Dominion Energy Inc Report

and

TXU

( TXU), have sent volts of panic through the market with dismal financial news that sounds eerily like a sequel to the merchant energy horror story. With the Philadelphia Utility Index hugging near-decade lows, utility analysts are struggling to find a safe place to aim.

"The list of stocks we would consider absolutely immune to significant financial strain is growing precariously short," said Christopher Ellinghaus, an analyst at Williams Capital Group.

Ellinghaus ticked off a few possibilities:

Southern

(SO) - Get Southern Company Report

,

Detroit Edison

(DTE) - Get DTE Energy Company Report

,

Kinder Morgan

TheStreet Recommends

(KMI) - Get Kinder Morgan Inc (KMI) Report

,

Wisconsin Energy

(WEC) - Get WEC Energy Group Inc (WEC) Report

and

Keyspan

( KSE). But he was hard-pressed to stretch that list much further.

"Well," he finally concluded, "

Hawaiian Electric

(HE) - Get Hawaiian Electric Industries, Inc. Report

doesn't appear to have any real problems of consequence.

"Those would be my candidates," Ellinghaus continued. "But plenty of people would look at my list and debate even those."

Endangered Species

Compared to Jon Cartwright, senior power and energy analyst at Raymond James, Ellinghaus sounds downright optimistic.

Ellinghaus has simply declared safe utility stocks "almost nonexistent." Cartwright, who conducts fixed-income research, says they're never coming back.

Cartwright believes the industry's shakiest days still lie ahead and will not materialize, interestingly enough, until the economy -- and, more specifically, fuel prices -- strongly rebound.

"Utilities have to buy power and/or natural gas in the open market," Cartwright explained. "They're not going to be able to pass on 100% of any cost increase to their customers.

"Even those in a very friendly regulatory environment won't be able to raise rates by 400% or 500%" to offset fuel hikes that, history shows, can hit dramatic peaks.

Cartwright is convinced that deregulation effectively killed the stable, cash-generating utility and turned it into another investment species entirely. He compares the evolution to similar changes in other deregulated industries, such as railroads and savings and loans, that transformed once-safe investments into much riskier vehicles.

Eventually, Cartwright believes that utilities will find eager buyers willing to accept additional risks for the promise of greater returns. But for now, he advises against buying utility stocks that he regards as universally overvalued.

And he's wasting no time looking for winners on a probable losing team.

"That's like arranging chairs on the Titanic," he said. "The market doesn't care who the good guys are when the whole group is selling off."

Trophy Picks

But some industry experts have no plans to throw in the towel.

Among these are hedge fund managers who, admittedly, have scooped up tidy profits betting against the power sector. But they continue to contend that there's money to be made on both sides of the fence.

One short-seller, who predicted the recent spiral of both

CMS

(CMS) - Get CMS Energy Corporation Report

and

Duke

(DUK) - Get Duke Energy Corporation (DUK) Report

, is placing long bets on the handful of utilities whose business models and management teams he still trusts.

He likes

Entergy

(ETR) - Get Entergy Corporation Report

-- a winner

highlighted by

TheStreet.com

months ago -- because of its huge cash pile, its stock buybacks and its potential for a dividend increase. (The company also just beat earnings estimates, although it lost all gains from its preannouncement during this week's bloodbath.)

He also likes

Constellation

( CEG), in part because of a trading operation that's scared other investors off. That operation managed to originate new business even during the trading meltdown of July and, today, continues to enjoy a strong balance sheet and $1.8 billion in untapped credit lines.

But his favorite pick is

PPL

(PPL) - Get PPL Corporation Report

, a utility that -- in a sea earnings warnings and industry chaos -- just reaffirmed strong guidance for 2003.

"That company is clean," he insisted. "I have to hang my hat on something."

Analysts at another firm pick

Exelon

(EXC) - Get Exelon Corporation Report

, in addition to two companies on Ellinghaus' short list -- Detroit Edison and Southern -- as favorites. They said all three are "absolutely solid" utilities unfairly punished for the company they keep.

Southern Man

Peter Cohan, a Massachusetts author and investment strategist, described Southern as the most attractive of the lot. He said the company has plenty of cash, a safe dividend and a 96% debt-to-equity ratio that's much lower than that of even its strongest peers.

"It's clear that Southern is a nice, solid, conservative investment," Cohan said. "Any regulated utility without a hint of Enron is starting to look pretty good."

With near-perfect timing, Southern managed to shed its "hint of Enron" -- energy trader

Mirant

( MIR) -- prior to the sector's total meltdown. Since then, Mirant's stock has slid out of the $20s to just above $1, stirring fears of possible bankruptcy.

Some believe that a few once-stable utilities now face similar threats. The market, shooting anything that looks dangerous, seriously wounded two of those companies this week. TXU, recently a $40 stock, plunged to a low of $13.85 over credit downgrades and liquidity fears. And

Teco

(TE)

saw its stock whacked in half, tumbling to a decade low of $12.01 a share, after springing news of an equity offering on a hostile market.

Teco had already issued a new slug of equity this summer and, in recent weeks, had indicated no need to do so again. Investors showed no tolerance for the latest about-face.

"Management can't see very far ahead," one short-seller declared. "My mother can model better than they can -- and she's a minister."