Utility Stocks – September 2002
One of the most confounding aspects of the bear market is the collapse of stocks that were seen as safe. I am not referring to GE, which was known to be playing games with its accounting and was selling at much too high a price, but specifically to utility stocks. The collapse would not have been a great surprise if investors had understood the extent to which utility companies had turned away from their conservative past and gone off in speculative directions. The stocks are down so much that they probably offer one of the best opportunities in the market, but figuring out how to act on the opening is difficult because the condition of the companies is up in the air.