Additionally, information was provided about DUK and its competitor NEE within the scope of DuPont analysis. Based on the information presented within this document, the recommendation would be to purchase DUK. While the P/E forward trend and the Dividends-and-Earnings methods presented differing results, DUK is still a good buy because it has historically paid dividends and provided growth each year. It is not unreasonable to assume growth will continue, however, the actual rate of growth assumed in the Dividends-and-Earnings approach maybe higher or lower than expected. In fact, many analysts will agree that the combination of good dividend growth and earnings of the past will lead to the possibility of the same in the future and thus DUK is seen as a good investment (Debbas, …show more content…
DUK has made dividend payments for 90 straight years and for an investor who is looking for dividend income, DUK’s yield of 4.3% is appealing (Bollinger, 2016). As also noted by Bollinger (2016), the stock may not be a bargain today; however, as indicated in the P/E calculation, if DUK makes its potential return of 8-10% in the future, all DUK investors who subscribe to the Dividends-and-Earnings model will be happy. Additionally, Debbas (2016) provides that electric utility stocks have performed very well thus far in 2016; but they are not trading at a