When market uncertainty abounds, investors tend to flock to more defensive investments. Fortis (TSX:FTS)(NYSE:FTS) is a great example of a defensive investment, which is a worthy addition to nearly any portfolio. But Fortis isn’t just another solid investment that you should consider during a downturn; Fortis can provide income and growth in any market.
Here’s a look at why your portfolio needs Fortis, perhaps now more than ever.
Fortis is the solid investment option your portfolio needs
Let me start off by saying that Fortis is huge. The company is among the 15 largest utilities on the continent and boasts over $57 billion in assets. Fortis has 10 different utility operations located in Canada, the U.S., and the Caribbean. Those operations are mostly regulated, providing a steady stream of revenue to the company. In fact, 99% of the company’s earnings stem from regulated utilities.
How does that work? In short, Fortis negotiates long-term contracts known as power-purchase agreements (PPAs). The PPA stipulates how much power Fortis sells and at what rate. PPAs often span decades in duration, which effectively means that as long as Fortis keeps the power running, the company has a steady, recurring source of revenue.
This factor alone makes Fortis an incredibly solid investment option to consider during a downturn, but there are still other points to mention. Specifically, let’s talk about expansion.
Utilities are typically stereotyped as lacking in growth. The argument often cited is that with a predictable and stable revenue stream, there is little need or financial muscle to pursue growth options. Fortunately, that stereotype doesn’t apply to Fortis.
Fortis has completed a series of well-executed and increasingly larger acquisitions over the years. Those acquisitions have helped the company enter new markets as well as provide a source of growth for Fortis’s dividend (more on that in a moment).
In terms of results, in the first fiscal of 2020, Fortis earned $312 million, or $0.67 per common share. By way of comparison, in the same quarter last year, Fortis earned $311 million, or $0.72 per share.
What about income?
Fortis provides investors with a solid and reliable quarterly dividend. The 3.49% yield currently on offer is not the highest yield in the market, but it is stable and growing. In fact, Fortis is one of a handful of companies that have provided annual upticks to its dividend going back decades. In the case of Fortis, the company has provided investors with a whopping 46 consecutive annual hikes.
Turning to the future, Fortis continues to forecast annual upticks of 6% through 2024. This makes the stock a great and solid investment option for income-seeking investors as well.
No stock is without risk, and in times of uncertainty, we tend to gravitate back towards what we view as safer investments. Utilities such as Fortis are prime examples of this. That being said, don’t take that to mean that you should only invest in Fortis during a downturn. Fortis is a solid investment option for long-term investors that should be core to any portfolio, irrespective of any downturn.
Source: – The Motley Fool Canada
Bitcoin hits three-month low
Bitcoin dropped to a three-month low on Monday as investors sold cryptocurrencies in the wake of Tesla boss Elon Musk’s hinting over the weekend that the carmaker is considering or may have already sold some of its bitcoin holdings.
Musk has boosted crypto markets with his enthusiasm for the asset class, but has lately roiled trade by appearing to cool on bitcoin in favour of its one-time parody, dogecoin. The gyrations are beginning to spook even steeled traders.
“This has gone from clear FOMO (fear of missing out) to fear of not getting out, and you’re seeing a lot of people dumping,” said Chris Weston of brokerage Pepperstone in Melbourne, adding that he was looking at the 200-day moving average just below $40,000 as the next key test for bitcoin.
“Why would I want to buy bitcoin right now — even if I’m bullish — until the liquidation is over and you see some consolidation in price?”
Bitcoin fell more than 9% on Monday to as low as $42,185, its lowest since Feb. 8, while ether, linked to the ethereum blockhain, fell even more to as low as $3,123.94. Dogecoin fell nearly 7% to $0.48, and all three are well under recent records.
On Wednesday, Musk said Tesla would stop taking bitcoin as payment, owing to environmental concerns about energy use to process transactions. Defending that decision on Sunday, he suggested Tesla may have sold its own holdings.
In response to an unverified Twitter account called @CryptoWhale, which said https://bit.ly/2QsUQkw: “Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings. With the amount of hate @elonmusk is getting, I wouldn’t blame him…,” Musk wrote: “Indeed”.
It is not clear whether he was confirming sales or whether he referred only to the fact that he had faced criticism.
Musk said Tesla would not sell its bitcoin, but the cryptocurrency has dropped by almost a quarter since Musk’s reversal on Tesla taking it as payment.
On Tuesday, Reuters reported Tesla is seeking to enter the multi-billion dollar U.S. renewable credit market, hoping to profit from the Biden administration’s march toward new zero-emission goals.
Dogecoin is also yet to fully recover from Musk describing it as a “hustle,” although he did boost the price last week by saying he was working to improve its efficiency.
For an asset class that has surged this year, with dogecoin up about a hundredfold, ether up more than fourfold and bitcoin gaining 45%, some are beginning to call time on the wild ride.
“Our weekend trading has kicked up, and we’re looking at some serious liquidations through the exchanges,” said Pepperstone’s Weston.
“I am closing the short-bitcoin/long-ethereum trade and moving to the sidelines,” he added. “I feel the dust really needs to settle here.”
(Reporting by Tom Westbrook in Singapore. Additional reporting by Radhika Anilkumar in Bengaluru and Vidya Ranganathan in Singapore. Editing by Gerry Doyle)
U.S. stocks rebound following rout, bond yields dip
U.S. shares rebounded on Thursday after falling for three consecutive days and benchmark Treasury yields dipped, as investors snapped up technology stocks and shrugged off worries about rising prices, for now.
After posting their biggest slump in at least 11 weeks on Wednesday, U.S. shares bounced back as cash-flush investors looked past concerns that accelerating inflation may prompt quicker interest rate hikes, and deployed their funds once more.
So intent were investors on leaving inflation worries aside that financial markets barely responded to Thursday’s data, which showed U.S. producer prices posting their biggest annual gain since 2010 in April.
“It’s rebound Thursday,” said John Augustine, chief investment officer at Huntington Private Bank, which manages $20 billion. “Given the money on the sidelines, investors are going to be coming back in.”
Still, Augustine said investors should re-deploy their funds in a measured way because “inflation concerns are not going away”.
By midday, the Dow Jones Industrial Average had added 1.4%, while the S&P 500 and the Nasdaq Composite narrowed earlier gains to be up 1.3% and 0.9%, respectively.
The MSCI world equity index, which includes 50 countries, also bounced slightly, gaining 0.2%.
U.S. stocks had tumbled earlier this week after data showed U.S. consumer prices unexpectedly jumped by the most in almost 12 years in April.
Some investors now worry that quickening price pressures could lead the Federal Reserve to tighten monetary policy sooner than expected, and reduce its supply of cheap money that has been propelling financial markets higher.
For now, however, inflation woes took a backseat.
Benchmark 10-year Treasury yields, which had spiked 7 basis points overnight in the biggest daily rise in two months, edged down by more than 3 basis points to 1.6625% as investors took a breather.
Benchmark two-year Treasury yields also pulled back to 0.1589%.
Against a basket of major currencies, the dollar was steady at 90.727, holding gains eked out on Wednesday when expectations of rate hikes burnished the currency’s appeal.
A firm dollar capped gains in the euro, which edged up 0.1% to $1.20875. [USD/]
The pull-back in Treasury yields helped gold to recoup some of Wednesday’s losses, when the jump in bond yields dampened the allure of non-yielding bullion. Spot gold climbed 0.7% off a one-week low to $1,825.61 per ounce.
A recent rally in oil prices also paused on Thursday as investors turned their attention to the coronavirus crisis in India, and as a key U.S. fuel pipeline resumed operations.
Brent crude slumped 3.5% to $66.93 a barrel, while U.S. West Texas Intermediate crude lost 3.8% to $63.53 a barrel.
Among cryptocurrencies, bitcoin, which tumbled 13% overnight when Elon Musk said Tesla would stop accepting it as payment because of its high energy use, fell below $50,000 again on Thursday following reports that the U.S. Justice Department is investigating crypto exchange Binance.
By midday, bitcoin had dropped 2.2% to $48.314.
(Reporting by Koh Gui Qing; additional reporting by Tom Wilson and Marc Jones in London; Wayne Cole in Sydney; Editing Nick Macfie, Dan Grebler and Cynthia Osterman)
Dogecoin dropped after Elon Musk calls it a ‘hustle’ on ‘SNL’ show
By Alden Bentley and Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) -The value of dogecoin dropped sharply in early U.S. hours on Sunday, after Tesla chief and cryptocurrency supporter Elon Musk called it a ‘hustle’ during his guest-host spot on the “Saturday Night Live” comedy sketch TV show.
Dogecoin was quoted as low as $0.47 on crypto exchange Binance, down 28% from levels around $0.65 before the show.
The billionaire Tesla Inc chief executive hosted the show at 11:30 p.m. EDT on Saturday (0330 GMT on Sunday).
Cryptocurrency enthusiasts had for days been eager to see what he would say, after his tweets this year turned the once-obscure digital currency into a speculator’s dream.
Asked ‘what is dogecoin’, Musk replied, “It’s the future of currency. It’s an unstoppable financial vehicle that’s going to take over the world.”
When a show cast member Michael Che countered, “So, it’s a hustle?”, Musk replied, “Yeah, it’s a hustle.” And laughed.
Musk is the rare business mogul to have been asked to host the venerable comedy TV show. The timing puts Musk back in the spotlight just as Tesla’s stock is losing steam following last year’s monster rally.
The unconventional CEO has posted numerous comments about cryptocurrencies on Twitter and criticized regular old cash for having negative real interest rates.
“Only a fool wouldn’t look elsewhere,” he said in February.
His cryptic tweets “Doge” and “Dogecoin is the people’s crypto” that month kicked off a rally in dogecoin – created as a parody on the more mainstream bitcoin and ethereum.
On Thursday, Musk tweeted: “Cryptocurrency is promising, but please invest with caution!” with a video clip attached in which he said, “it should be considered speculation at this point. And so, you know, don’t don’t go too far in the crypto speculation …”
But he also said, in the video, that cryptocurrency has a “good chance” of becoming what he called “the future currency of the Earth.”
On crypto data tracker CoinGecko.com, dogecoin has jumped more than 800% over the last month and is now the fourth-largest digital currency, with a market capitalization of $73 billion. It hit a record high Thursday above $0.73.
It has overtaken more widely used cryptocurrencies such as litecoin and tether.
Tesla said in February it bought $1.5 billion worth of bitcoin and would soon accept it as a form of payment for its electric cars, a large stride toward mainstream acceptance that sent bitcoin soaring to a record high of nearly $62,000.
Tesla shares closed 1.3% higher at $672.37 on Friday.
(Reporting by Gertrude Chavez-Dreyfuss and Alden Bentley in New York, and Noel Randewich and Hyunjoo Jin in San Francisco Additional reporting by Joe White and Vidya RanganathanEditing by Matthew Lewis & Simon Cameron-Moore)
Mexican union was set to lose disputed GM workers’ vote
EU regulator backs month-long storage of Pfizer COVID-19 vaccine in fridges
UK sanctions Myanmar Gems Enterprise in bid to cut off junta funding
Silver investment demand jumped 12% in 2019
Iran anticipates renewed protests amid social media shutdown
Europe kicks off vaccination programs | All media content | DW | 27.12.2020 – Deutsche Welle
News14 hours ago
U.S. Supreme Court takes up major challenge to abortion rights
Investment24 hours ago
Bitcoin hits three-month low
News15 hours ago
China aim relax birth policy but wary of social risks, sources say
News15 hours ago
U.S. imposes fresh sanctions on Myanmar junta
News15 hours ago
Can Israel blast Gaza and still make friends in the Gulf?
Media12 hours ago
Snap to cut emissions, achieves carbon neutrality in new climate strategy
Economy15 hours ago
U.S. Dollar essentially unchanged as Treasury yields hold steady
Economy14 hours ago
World Economic Forum cancels 2021 annual meeting in Singapore