PPL

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

You can't build a dividend portfolio without looking at utility stocks -- which brings us to PPL ( PPL).

PPL is a utility stock that owns 11,200 megawatts of generation capacity, and provides regulated utility service to electricity customers in Pennsylvania, Kentucky, Virginia, Tennessee and the UK. PPL also distributes natural gas to Kentucky. Just a few years ago PPL was primarily a generation firm, earning three-fourths of its profits by selling power on the open market. Today, though, the firm has shifted its strategy towards the stable income of the regulated utility business.

Stable, predictable income is the hallmark of a stellar dividend stock, and PPL has managed to pick up its regulated exposure while still keeping its uniqueness. A big differentiator for PPL is its energy distribution unit in the UK -- that expertise in a foreign market should open the door to other overseas utility operations if attractive opportunities present themselves down the road.

Dividend growth at PPL is likely to cool in the next couple of years as the firm dumps considerable CapEx into upgrading its infrastructure. That's actually a good thing for dividend investors because it means that PPL's dividend prospects are going to be artificially held down in the near-term. With the firm's payout already at 4.87%, investors shouldn't have any trouble waiting a while for the next hike.

To see these dividend plays in action, check out the at Dividend Stocks for the Week portfolio on Stockpickr.

And if you haven't already done so, join Stockpickr today to create your own dividend portfolio.

-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:



Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

If you liked this article you might like

The 6 Medications Being Used to Tackle the Opioid Epidemic

Allergan's Restasis Patent Transfer to Face Precedent-Setting Legal Battle

Friday Selloff May Be On Its Way; Tenet Gears Up for Sale -- ICYMI

Dow Posts Fresh Record, Third in a Row, but S&P 500 and Nasdaq Fall