Power Play
Utility stocks have gone back to basics.
In the days before deregulation of the utility industry, electric and gas stocks provided investors with a steady income stream that ranked low on investment stress. That all changed during the hotshot '90s, as many utility companies bought into businesses they knew little or nothing about, like telecommunications or home security. Now the tide has turned, and gas and electric companies are getting back to what they know best-power.
"Many [utilities] went into risky businesses and lost as their share values dropped," says Barry Abramson, co-portfolio manager of the Gabelli Utilities Fund (GABUX). "The management that survived learned their lessons, and now many are in better shape with a 'back to the basics' business strategy."
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