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PPL: A Dividend Powerhouse

Published Mon, 20 Jul 2020 10:54:01 -0400 on Seeking Alpha

Seeking AlphaDividend Ideas | Utilities PPL: A Dividend PowerhouseJul. 20, 2020 10:54 AM ET|| About: PPL Corporation (PPL), Includes: DUK, FE, SOby: The Dividend PortfolioThe Dividend Portfolio Dividend investing, dividend growth investing, value, long-term horizonSummaryPPL is a highly profitable regulated utility company that boasts geographically diverse and stable business segments in the U.K. and the United States.
PPL is also undervalued, with PPL having an appealing forward PE Ratio, a near historically high starting dividend yield and the potential for strong yield on cost growth moving forward.
However, it is important to note that PPL faces challenges from a high debt ratio and regulatory changes that could be detrimental to the company’s operations.
Regardless, I believe that PPL’s diverse business segments and significant operating margins can support the company’s current impressive high yield dividend, which could make PPL an appealing dividend investment.
PPL (NYSE: PPL) is a profitable regulated utility company that is currently undervalued. Starting in the 1990s, PPL began expanding their operations from Pennsylvania following PA's deregulation of electric utilities. Now, as of 2020, PPL operates utilities in the U.K. and multiple regions within the United States. This expansion has led to significant increases in long term debt and equity through sales of additional shares, with revenue growth recently being stagnant and the company facing potential risks over changes in regulatory policies. However, PPL has experienced impressive growth in profitability over the last two decades and the company supports geographically diverse business segments. Furthermore, PPL also has an appealing forward PE ratio, a historically high starting dividend yield and has the potential to provide strong dividend growth moving forward, even compared to other utility companies. Taken together, I believe that PPL has the potential to sustain their current... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
SOUTHERN COMPANY 59.99   14.0 4.28 2.48 4.19
DUKE ENERGY 94.96   21.0 4.52 3.78 4.02
FIRSTENERGY 47.63   119.1 0.40 1.52 3.25


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