Northeast Utilities (NU): Today's Featured Utilities Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Northeast Utilities ( NU) pushed the Utilities sector higher today making it today's featured utilities winner. The sector as a whole closed the day down 0.1%. By the end of trading, Northeast Utilities rose 42 cents (1.1%) to $38.65 on heavy volume. Throughout the day, 2.3 million shares of Northeast Utilities exchanged hands as compared to its average daily volume of 1.5 million shares. The stock ranged in a price between $38.24-$38.71 after having opened the day at $38.38 as compared to the previous trading day's close of $38.23. Other companies within the Utilities sector that increased today were: Empresa Distribuidora y Comercializadora No ( EDN), up 6.5%, China Hydroelectric Corporation ( CHC), up 6.2%, Integrys Energy Group ( TEG), up 4.6%, and Enersis ( ENI), up 2.8%.
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Northeast Utilities, a public utility holding company, provides energy delivery services to residential, commercial, and industrial customers in Connecticut, New Hampshire, and Massachusetts. Northeast Utilities has a market cap of $11.9 billion and is part of the utilities industry. The company has a P/E ratio of 21.8, above the average utilities industry P/E ratio of 20.4 and above the S&P 500 P/E ratio of 17.7. Shares are up 6% year to date as of the close of trading on Friday. Currently there are nine analysts that rate Northeast Utilities a buy, no analysts rate it a sell, and four rate it a hold.

TheStreet Ratings rates Northeast Utilities as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the negative front, American DG Energy ( ADGE), down 4.3%, U.S. Geothermal ( HTM), down 3.2%, Transportadora de Gas del Sur ( TGS), down 2.5%, and National Fuel Gas Company ( NFG), down 2.2%, were all laggards within the utilities sector with Public Service Enterprise Group ( PEG) being today's utilities sector laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the utilities sector could consider Utilities Select Sector SPDR ( XLU) while those bearish on the utilities sector could consider ProShares UltraShort Utilities ( SDP).

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