PUC Impact Felt

摘要

State commissions are having a real impact on the value of the stocks we follow. The top three and seven of the bottom 10 of the "April 2008 Winners and Losers" were propelled upward or downward by state regulatory issues. (See chart.) The good news? Only eight companies were in negative territory for the month. Rapidly increasing capital expenditures coupled with increasing fuel, purchased power and natural gas costs will continue to challenge utility management for the foreseeable future. How state regulators deal with these issues will determine the fate of the equities of the more regulated components of our indices. Those companies with pre-approved allowed returns on construction expenditures (or similar mechanisms) and those companies with adequate fuel and purchased power recovery clauses are likely to perform better than those without.