Don't Ignore This Chart!

De-fense! Looking to Higher-Yielding Stocks as a Market Buffer


While last week's historically sharp drop in the markets was damaging to every area of the markets, what was most surprising was the hit that the normally-defensive Utility stocks endured. While not the worst performer for the week, this sector dropped more than the broader markets, with many individual stocks dropping even further.

The good news is that Utility stocks are the top performers week-to-date, with money flows back into these higher-yielding stocks now pushing them close to their prior highs. And, even better news, not only do the top performers in this group provide high yields, they have high growth prospects as they're providing energy to the top-growing areas in the U.S.


Above is a daily chart of Duke Energy (DUK), which provides energy to both North and South Carolina, among other areas. These Southern states are among the top 5 growing areas in the U.S., and the influx of residents has pushed up demand for Utilities.

As you can see, the stock hit an all-time high in price early last week before getting hit with the broader markets. This week, the 3.7% yielder has staged a v-shaped recovery, which has put the stock back into a buy zone. Given its sharp advance over the past several days, I'd be a buyer on any pullback.

Duke Energy is one of a select group of Utility stocks that is finding growth not only from the areas they service, but also from their conversion to alternative energy sources that's being met with increased commercial demand. If you'd like to be alerted to the other Utility stocks with superior growth prospects in an otherwise difficult environment, take a look at my MEM Edge Report.

Even more importantly, with this report you'll also be alerted to when it's safe to begin accumulating high growth stocks once the market's uptrend has resumed. Use this link here to get a 4-week trial of the MEM Edge Report for a nominal fee. This in-depth bi-weekly report also provides additional alerts throughout the week as the markets warrant.


Mary Ellen McGonagle,

MEM Investment Research

Mary Ellen McGonagle
About the author: is a professional investing consultant and the president of MEM Investment Research. After eight years of working on Wall Street, Ms. McGonagle left to become a skilled stock analyst, working with William O’Neill in identifying healthy stocks with potential to take off. She has worked with clients that span the globe, including big names like Fidelity Asset Management, Morgan Stanley, Merrill Lynch and Oppenheimer. Learn More
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