Two Top Utility Stocks for Income Seekers

I project that these companies will be able to boost their dividends more or less in line with the cost of living for many years to come:

Utility Stock #1: AGL Resources (AGL)

Parent of Atlanta Gas Light, AGL Resources (AGL) distributes natural gas in Florida, Georgia, Maryland, New Jersey, Tennessee and Virginia — states with generally faster population growth than the nation as a whole.

Over the past five years, AGL has raised its dividend a handsome 53%, including the latest hike, announced in February. However, I expect the pace to slow in 2010–2012 as the company's ambitious construction program drains off cash.

Current yield: 6.0%.

Utility Stock #2: Dominion Resources (D)

A diversified giant with $16 billion of annual sales, Virginia-based Dominion Resources (D) generates electricity and sends it out to both wholesale and retail customers. In addition, the company operates an extensive natural gas pipeline network, as well as gas-gathering and storage facilities.

I like D's well-rounded profile: regulated businesses that provide stability and unregulated businesses that deliver growth. Dividends have increased 31% over the past five years.

Current yield: 5.6%.

As editor of Profitable Investing, Richard E. Band is the newsletter world's #1 authority on investing for low-risk growth. His flagship Total Return Portfolio has tripled in value since its inception in 1990, while taking far less risk than the popular stock market index funds. See for yourself what Profitable Investing can do for you. In fact, try it for 6 months, 100% risk-free. Click here for more details.