CenterPoint (CNP) operates as a public utility holding company. It engages in the transmission and distribution of electricity to retail electric providers (REPs), municipalities, electric cooperatives and other distribution companies serving approximately two million metered customers in Texas. Based in Houston, the company has a $10.3 billion market cap and trades an average of 4.5 million shares a day.
Dividend Yield: 4%
Price To Book: 2.3
Forward Estimated Earnings Payout Percentage: 72%
A dividend payout ratio over 50% receives extra scrutiny because of increased risk of a dividend drop. I reviewed the dividend distributions since 2007 and the result is a movement in only one direction. Dividend payments have consistently gone up every year in the last seven years.
Also, the ability of public utilities to continue steady dividends is unparalleled in any other industry. Buying utilities for dividends may be old-school investing, but making money never goes out of style.
Five out of 12 analysts now rate CenterPoint a buy, seven rate it a hold and none recommend selling. CenterPoint has an average analyst target price of $26.11.