Covestor model manager James Hofmann manages the Greater China and Dividend Growth portfolios. James, a value investor, believes return on equity and dividends create and drive investor wealth.
While hunting for companies with strong dividends in the 5 – 6% yield range, James often looks at utilities companies. His expertise in the area was recently identified by Chicago Tribune reporter Julie Wernau, who interviewed James for an article on Exelon’s (NYSE: EXC) bid for Constellation Energy Group (NYSE: CEG):
Exelon on Thursday announced a deal to acquire Baltimore-based Constellation Energy Group Inc. with $7.9 billion in stock, which would create a combined company operating an energy fleet that is 87 percent low-emission generation: nuclear, hydroelectric, wind, solar and natural gas.
And as the U.S. Environmental Protection Agency toughens its stance against hazardous air pollutants and mercury emissions, threatening the future of coal generation, Exelon/Constellation would have an advantage over many of its peers. That’s because most of its fleets either are nonemitting or outfitted with the necessary environmental controls.
“There’s definitely an advantage,” said James Hofmann, who manages a portfolio for Covestor, with more than 8 percent allocated to Exelon. “Exelon gets to sit back and benefit from the rising prices consumers will be paying. Their costs won’t go up, their margins will actually go up and that’s increased profitability that goes right to the shareholders.”
It is great to see Covestor model managers recognized for their expertise.
Sources:
“Exelon’s bid for Constellation Energy in line with CEO John Rowe’s low-emission goals” Julie Wernau. Chicago Tribune, 4/28. http://www.chicagotribune.com/business/ct-biz-0429-exelon-constellation-20110428,0,7659736.story
