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Cleco Corporation (NYSE:CNL) is a low profile regulated utility with operations in Louisiana and an innovative new power plant that can burn biomass or petroleum coke to generate power. The company has also been insulated somewhat from the recession by the relative strength of the Louisiana economy. We'll take a deeper look into this company and its stock.

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Cleco Corporation has 2 segments, a regulated utility and Cleco Midstream, a wholesale energy business.

Cleco Power
Cleco Power is the company's regulated utility segment. The company has a rate base of $2.24 billion, and is allowed a 10.7% return in equity. Cleco Corporation owns 2,539 megawatts of generation capacity. It serves 277,000 retail and 98,000 wholesale customers.

The other large utility in Louisiana is Entergy (NYSE:ETR), which serves a large number of customers.

Cleco owns a mix of generation capacity including natural gas, coal, lignite and a new facility that burns petroleum coke - a byproduct of the refining process. The Rodemacher 3 produces 600 Megawatts and uses a process called circulating fluidized bed technology. It can burn petroleum coke, as well as biomass to generate power including wood, waste and agricultural products.

Petroleum coke is an abundant material. Valero Corp (NYSE:VLO) alone produced 8 million tons of the material in its refining operations. Cleco believes that using petroleum coke will help diversify and stabilize its generation costs. It plans on burning 1.5 million tons of petroleum coke per year here.

Cleco Midstream
Cleco Midstream is the company's midstream business. This unit produces 1,065 Megawatts of power, and the company has been trying to exit this business for several years. Cleco owns 3 natural gas power plants, the Acadia Unit 2, and the Evangeline Units 6 and 7.

The company has a pending sale of Acadia Unit 2 to Entergy for $300 million, and expects to close on that sale by the end of 2010 or early 2011.

Cleco is working on selling Evangeline Units 6 and 7, and is currently selling the output of these 2 plants to JP Morgan (NYSE:JPM) through 2011.

Louisiana Economy
One advantage for Cleco Corporation the last year has been the strength of the Louisiana economy relative to the rest of the United States during the recession. Louisiana has an unemployment rate of 7.4%, compared to a national rate of 9.7%.

Dividend
Cleco also pays a healthy dividend like other utilities. The company just raised this annual dividend to $1.00 per share, giving a yield of around 3.75%.

Bottom Line
Cleco Corp is a low risk regulated utility with a healthy and rising dividend, and the company has also progressed through the recession better than some of its peers. (Thinking about adding dividends to your portfolio? Read Cheap Value Dividends.)

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