Duke Energy Stock: Why Shareholders Don’t Get Rich

In 2001, the price of Duke Energy stock was $81. In 2019, it is $90. A generation of one’s investing life has come and gone, and Duke Energy shareholders have almost no capital appreciation to show for it. They have lived almost exclusively on a 3.88% dividend that they have averaged over this time frame, with total annual returns of 4.85% over the past eighteen years. Granted, for one who reinvested, the results were nearly 6%, which speaks to the power of pouring cash dividends into a cash-generating asset over long periods of time even if the asset itself has some mediocre characteristics.

Duke Energy owns vast and lucrative utility assets, but the high debt burden puts a damper on the returns that investors receive. This is a shame because it renders DUK stock as nothing more than a mediocre stock investment despite owning assets that should be delivering great
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