10% Yields in a 5% World - Junk bonds

Kiplinger's Personal Finance Magazine, April, 1999 by Steven T. Goldberg

Because they have such high yields, these MLPs have low growth potential, and their prices tend to drop when commodity prices fall.

UTILITARIAN YIELDS

As competition heats up among utilities, yields are declining a bit because companies want to retain earnings to fight off (or purchase) competitors. Still, some utilities pay generous yields. Mark Luftig, an analyst with W.H. Reaves & Co., offers these selections:

Ameren Corp. (AEE, NYSE, $38), yielding 6.8%, is located in the Midwest. Luftig expects earnings to grow.

Hawaiian Electric Industries (HE, NYSE, $36) is one of the best-insulated utilities against competition because of its location. It yields 6.9%.

Western Resources (WR, NYSE, $29) provides power in Kansas and Oklahoma and also owns a large home-security business. It yields 7.4%.