Fisher Investments on Utilities

Foreword

I’m pleased to introduce the ninth in a series of investing guides from Fisher Investments Press. This imprint—the first ever from a money manager—aims to bring the accumulated investing wisdom of my firm to you in category, bite-sized formats, whether you’re an investing enthusiast, student, or aspiring professional.

This particular series, the Fisher Investments On series, presents a usable, top-down strategy for analyzing standard investing sectors (Energy, Materials, Consumer Staples, Health Care, Utilities, etc.) as well as other investing regions and categories. Each book is meant to stand alone—choose a topic that particularly interests you. But together, they can be a rigorous, do-it-yourself training program for the full breadth of capital markets analysis.

The book in your hands is on Utilities—currently about 4 percent of total world stocks (as measured by the MSCI All Country index). Unless you work for a utility, you probably never think about what powers your lamps, TV, or stove. Or at least you don’t think about it until the power goes out—then this sector’s importance is suddenly clear. It’s a smallish sector, but vital to how we live, work, and play. And that vitality explains a key defining characteristic of Utilities.

We take utilities for granted today, but in the nineteenth century, they were growth categories in America—as they are now in emerging markets. In late nineteenth-century America, electricity was very much like semiconductors were in the ...