Perspective

Deck: 
Wall Street analysts favor the utilities whose leaders think like they do.
Fortnightly Magazine - April 1 2001
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Wall Street analysts favor the utilities whose leaders think like they do.

Electric utilities have enjoyed a love/hate relationship with Wall Street in recent years. While market valuations have risen steadily in many industrial sectors, utilities have been riding a roller coaster. 1998 was essentially flat for electric utilities. Then the S&P electric index slumped by more than 22 percent in 1999. It rebounded in 2000, thanks in part to investor flight from Internet stocks, but not without a fair bit of carnage in California.

On one hand, it's natural to see changes in price performance for electric utility equities. (Witness the California crisis.) Yet certain utilities—and certain utility CEOs—have seen their efforts consistently recognized by Wall Street and rewarded by investors over the long term. With the many challenges facing today's utilities—such as consolidation, capital costs, debt burden, globalization, and deregulation—the CEO's role has become more important than ever.

Consider the following:

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