AltaVista estimates XLU will yield 3.6% this year.

“Environmental regulations and distributed generation (small, on-site and often alternative-source) represent dual threats to profitability– witness the decline in Return on Equity over the past few years. This year’s consensus forecasts are for no revenue growth and only minimal EPS growth. Meanwhile, higher P/E and other multiples have reduced Utilities’ attractiveness to about average in our opinion,” according to the research firm.

Utilities Select Sector SPDR


ETF Trends editorial team contributed to this article.