Panel Decision Puts Charge In California Utility Stocks

California’s usually stodgy utility stocks soared last week after the state Public Utilities Commission accepted a moderate proposal for bringing competition to the state’s $20 billion electricity market.

Pacific Gas and Electric Co., the nation’s largest investor-owned utility, jumped $1.50 to $28.50 Thursday, when the panel made its ruling. Southern California Edison was up 50 cents to $17.12 and San Diego Gas & Electric gained 88 cents to close at $22.25.

“These were extremely dramatic gains” for utility stocks, said William Tilles, an analyst at Smith Barney.

Investors were relieved that the commission’s proposal reduced uncertainty and recommended a slower timetable for deregulation.

A year ago, when the commission unveiled a more radical proposal for competition, California utility stocks were hammered.

Stanley Skinner, CEO of PG&E, estimated the proposal knocked about $4 billion off the market value of California’s three investor-owned utilities.

The PUC’s plan lifted utility stocks across the country as well as those in California.

Smith Barney’s Tilles said the California panel is considered a bellwether whose rulings may guide policy makers in other states.

Free annual reports

The first step in researching a potential stock investment is getting the company’s annual report. Generally, you can phone the company, and it will be sent for free. But that can be a expensive hassle, particularly if you’re looking at a bunch of companies.

Bay Tact Corp., a publisher of securities references, offers annual reports on 3,200 companies for free through a program called The Public Register’s Annual Report Service.

Investors who call 800-4-ANNUAL will be led through a message tree that allows them to request up to eight annual reports per call. Unfortunately, the system doesn’t tell you whether the reports you want are in stock, but the firm will send you a letter telling you how to get the missing reports and touting the firm’s products.

Digital proxy coming

It seems fitting that Transaction Network Services Inc. has introduced shareholder proxy voting to the digital age.

The company specializes in highspeed ways of carrying information on credit and debit cards.

In March, it mailed hundreds of proxy voting cards printed with personal identification numbers to shareholders unable to attend the company’s annual meeting. By dialing a toll-free 800 number, shareholders could vote on the company’s major policy decisions.

TNS plans to heavily market the method in time for proxy season next year. That means someday you might hear: “Press one if you want to sell the company to outside buyers; two, to issue additional stock; three, to change the board of directors, etc.

High-dividend stock picks

With bond yields dropping and corporate profits weakening, stocks that pay good dividends and have consistent earnings look more attractive.

The Value Line Investment Survey recently screened 20 low-risk stocks whose dividends have been rising and should keep doing so. Among them: Anheuser-Busch Cos., Clorox Co., General Electric Co., General Mills Inc., PPG Industries Inc., Wachovia Corp. and Warner-Lambert Co.

Mutual funds that focus on such stocks? Fidelity Equity-Income II, Smith Barney Premium Total Return and Safeco Income.