Friday, June 22, 2018


Home Sectors Utilities
The utilities sector include companies that sell gas and electricity either wholesale or retail or both. Utilities are very capital intensive and many are regulated due to their exclusive rights to sell to consumers and businesses in their respective service territories. Regulated utilities tend to be valued at a premium due to their monopoly status and ability to pass costs directly onto customers through increased rates. Their value is very sensitive to interest rates since the main reason to invest in publicly traded utilities is for their dividends, therefore as interest rates increase, their value tends to decrease in the short-term.