If you are like many investors, you find yourself dazzled by the sound and fury of the stock market. Months (if not years) of speculation about rising interest rates, the carnage in the oil sector, and continuing incidents of terrorism can certainly leave anyone confused, fearful, and uncertain. These are the times an investor needs to be levelheaded and take a step back to focus on what they know to be most important.
Like the heroes in the “Star Wars” movie anthology, we must find the answer within. Most of us intuitively know that steady, reliable, proven, and recognizable investments should make up the core of our portfolios. These are the type of investments that we should focus on during turbulent times. We know that there will always be the need for food, medicine, electricity, fuel, and other basic necessities. Companies serving these needs have shown their worth over decades and are not subject to fads or fashion. The names are familiar because they have been burned into our memories over time, largely because of the needs they fill.
We also know the value of diversification in spreading our investment risk, along with the value of investing over time, so as not to buy (or sell) at the most inopportune times. So the knowledge of these principles should serve as our guide during times of uncertainty.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
While others may be hard-pressed to find answers, we already know them if only we tap into our accumulated learning. Are we adequately diversified? If not, what sectors should we fill? And while we understand the need to invest for our futures, can we simply show the discipline to do it gradually, rather than gambling on large, one-time purchases?
If we are tempted to sell, can we take time to evaluate whether the reasons are sound and that we will accomplish something by doing so? These are the types of questions that we need to answer to our own satisfaction, rather than simply following the latest guru or talking head. We all should resolve to find a way to become more capable of answering these questions.
For all the above reasons, we at Moneypaper Publications LLC like SCANA Corp (SCG). Founded in 1924, SCANA engages in the generation, transmission, distribution, and sale of electricity to retail and wholesale customers in South Carolina. It also provides natural gas, offers energy-related risk management services, owns two liquefied natural gas plants, and provides tower site construction, management, and rental services in South and North Carolina. SCANA supplies electricity to 688,000 customers and provides natural gas to 859,000 residential, commercial, and industrial customers in North Carolina and South Carolina, as well as 450,000 customers in Georgia. According to Yahoo! Finance, consensus estimates call for the company to have earned about $3.82 per share in 2015 and $3.94 in 2016, compared with $3.79 in 2014. SCANA has increased its dividend for 15 consecutive years and its $2.18-per-share annual payout provides a yield of 3.8%.
What makes SCANA attractive is its position as a solid, reliable utility serving the growing populace of the Southeastern United States. The stock’s growing dividend is well covered by earnings. The payout ratio is just 57% of 2015 earnings and continuing dividend increases mean that the current yield likely will keep growing over time, compared with the current price.
And a strategy of dollar-cost averaging should be handsomely rewarded by the above-average yield compounding over time, driven by reinvestment and continued growth in the customer and earnings base. SCANA has all the hallmarks of a relatively safe, reliable holding that can be built from a single share to a large, solid holding for retirement.
Ms. Vita Nelson is one of the earliest proponents of dividend reinvestment plans (DRIPs) and a knowledgeable authority on the operations of these plans. She provides financial information centered around DRIP investing at www.drp.com and www.directinvesting.com. She is the Editor and Publisher of Moneypaper's Guide to Direct Investment Plans, Chairman of the Board of Temper of the Times Investor Service, Inc. (a DRIP enrollment service), and co-manager of the MP 63 Fund (DRIPX).
-
Should You Be Investing in a 529?Learn how to maximize investing in a 529, a state-sponsored college education savings account for qualifying educational expenses.
-
Why So Many Men are Bad at RetirementOlder men today came of age amid the social upheavals of the 1960s and ’70s, but their formative years were deeply planted in the traditional world of segregation and sexual stereotyping.
-
Hot Tips for Home Buyers and Sellers Right NowReal estate looks to be especially hopping this spring, thanks to pent-up demand and buyers adjusting to higher mortgage rates. Here’s how you can prepare.
-
Is 100 the New 70?Eating well, exercising, getting plenty of sleep and managing chronic stress can help make you a SuperAger. Funding that long life requires longevity literacy.
-
Nine Lessons to Be Learned From the Hilton Family Trust ContestDisclaimers, good communication, post-marital agreements and more could help avoid conflict in a family after the owners of a wealthy estate pass away.
-
Strategies to Optimize Your Social Security BenefitsTo maximize what you can collect, it’s crucial to know when you can file, how delaying filing affects your checks and the income limit if you’re still working.
-
Don’t Forget to Update Beneficiaries After a Gray DivorceSome states automatically revoke a former spouse as a beneficiary on some accounts. Waivers can be used, too. Best not to leave it up to your state, though.
-
What’s the Difference Between a CPA and a Tax Planner?CPAs do the important number crunching for tax preparation and filing, but tax planners look at the big picture and come up with tax-saving strategies.
-
Charitable Remainder Trust: The Stretch IRA AlternativeThe SECURE Act killed the stretch IRA, but a properly constructed charitable remainder trust can deliver similar benefits, with some caveats.
-
Three Ways to Take Control of Your Money During Financial Literacy MonthBudgeting, building an emergency fund and taking advantage of a multitude of workplace benefits can get you on track and keep you there.
