Income-seeking investors can find a bargain right now in the utilities sector. Utilities stocks are generally known for their safe dividends, but they aren't having a good year when it comes to returns. The Utilities Select Sector SPDR Fund has lost nearly 5% so far in 2023, compared to the S & P 500 's 19% gain. That means investors have the opportunity to scoop up some cheap stocks and earn income while waiting for them to rebound.
Pro screened for utilities in the utilities ETF that pay a dividend of 3.5% or more, and whose payouts are considered safe — with a dividend coverage ratio of at least 3. The dividend coverage ratio measures the net income of a company relative to the amount of dividends paid out to shareholders. Dominion Energy tops the list with a hefty 5% dividend yield. The Richmond, Virginia power producer also has a cash dividend coverage ratio of 3.2 and 7.