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5. Portland General Electric

Fitch highlights regulated Pacific Northwest utility Portland General Electric ( POR) as a potential takeover target. Currently, the 124-year old company has a market cap of $1.87 billion and a dividend yield of 4.26%.

Portland, Or.-based company has vertical generation, purchase, transmission, distribution and retail sales operations in Oregon, serving 717,719 retail customers in addition to another 100,000-plus of commercial and industrial customers. According to is Web site, the company generates $1,049.03 in annual revenue per customer.

In 1997, now-defunct Enron bought Portland General Electric for $2 billion in stock and an additional $1.1 billion in debt. After Enron fell into bankruptcy, an investor consortium led by former Oregon Governor Neil Goldschmidt and private equity firm Texas Pacific Group tried to buy PGE out of the bankruptcy for $3 billion in a multi-year deal negotiation that broke down in 2005. The company instead opted to become independent and underwent an initial public offering in May of 2006.

Fitch notes that the company operates in just one regulatory jurisdictions, which would have to approve any merger or takeover.

The company is expected to earn 45 cents a share when it reports fourth quarter earnings on Feb. 24, according to Zacks consensus estimates. Portland General Electric is expected to have revenue of $1.85 billion and net profits of $151 million in 2011, according to Bloomberg consensus estimates. In 2012, those sales and profit numbers are expected to rise to $1.9 billion and $145 million, respectively.

Analysts give Portland General Electric an average price target of $26.50 a share, an over 6.5% premium to the company's current share price of $24.88. For more on Portland General Electric shares, see the portfolio of investor David Dreman.

The company's shares gained over 16% in 2011, beating the sector index. Goldman Sachs analysts estimate that Portland General Electric will have a compounded annual dividend growth rate of 3% from 2010 through 2013, one of the 10 highest growth rates in its sector coverage.

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