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Comment by WarmWash | Hacker News Reader

Tickers please. I can make any flashy story about any industry if I hide a holistic picture of their finances.

I have literally provided you reports and company names. If you don't like the data, or don't believe the data, reconcile internally. UtilityDive is an industry publication, the financials are public.

You haven’t provided the relevant metrics to address their WarmWash’s claim. If the utilities are earning outsized profits, then their shareholders would be earning outsized returns.

Comparing long term returns using a website like this would help figure out if the businesses are over performing.

https://dqydj.com/stock-return-calculator/

Outsized profits does not necessarily mean it flows through to shareholders. That's a management choice. You can be very profitable and not buy back stock or issue dividends.

If you are insinuating corruption, then no discussion can be had since no numbers can be trusted. If there is no (or sufficiently little) corruption, then shareholder returns would be a reflection of the business’s profitability.

Call it what you want, these are unnecessary margins that should be crammed down. Regulation, nationalization, I am not picky how. Whether shareholders are seeing outsized returns from the regulatory capture, also not too concerned about.

I am fairly confident the cohort of those who support investor owned utilities are a vocal minority.

For all the non taxpayer owner utilities I am aware of, the margins and utility prices are completely controlled by government employees. Government employees that are hired by leaders that voters vote for.

Note that there exists the same incentives for publicly owned and investor owned utilities of voters today wanting lower utility prices at the expense of future utility customers by keeping capital expenses down today.

>I am fairly confident the cohort of those who support investor owned utilities are a vocal minority.

I will be the first to support only publicly owned utilities. But that has nothing to do with using bad logic and numbers to determine outsized margins.

I can't address these because most are part of larger orgs, so I am not sure where they are getting their numbers from or how they are constructed. But someone else replied with tickers (including parent companies of the ones you named) and I addressed those.

Here you go: XEL, AEP, SO, EIX, CPK, AQN, NGG, NEE

Thanks

These are their five year stock gains, with the general market for reference.

Market (SP500): 68%

Market(tech): 89%

XEL: +20%

AEP: +51%

SO: +47%

EIX: -5%

CPK: +2.5%

AQN: -64%

NGG: +30%

NEE: -3.5%

Looks like a pretty bad industry for profits, even stacking the dividend on AEP, it still comes up short of SP500.

Everything comes up short of the S&P 500.

Utility companies get local monopolies and in exchange their prices are regulated. Consequently they have moderate but stable, essentially guaranteed, returns.

Why would anyone invest in any other equity other than SP500 if they all come up short (assuming your goal is to have USD in the future)?

Diversification against concentration risk.

https://www.finra.org/investors/insights/concentration-risk

https://en.wikipedia.org/wiki/Concentration_risk

https://ncua.gov/regulation-supervision/letters-credit-union...

Your goal post for acceptable profit taking for utilities is… the S&P 500?

That makes very little sense.

And stock price is not a measure of profit.

If you are choosing to invest in equities for the long term, why is benchmarking against the lowest risk long term equity investment not sensible?

Although, a 5 year investment term is too short for comparing equity returns for a long term investment.

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