2020 was a dreary year for utility stocks , with the Dow Jones Utility Average Index ending up 1.6% in the red. Shares of Dominion Energy (NYSE: D) fared even worse, shedding 9.2% in 2020, according to data provided by S&P Global market Intelligence . Two major developments put tremendous pressure on the stock.
Dominion shares bounced back sharply after crashing alongside the broader stock market in March, but they failed to sustain the momentum. The first big blow came in the month of July, when the utility and partner Duke Energy canceled their long-drawn, multi-billion dollar Atlantic Coast Pipeline project because of cost and time overruns.
The same day, Dominion announced the sale of its gas storage and transmission segment to Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) for $9.7 billion, including debt worth $5.7 billion, in a bid to become a pure-play regulated utility. Although Dominion highlighted how the deal will help it improve its balance sheet among other things, investors were miffed for one big reason: a dividend cut.
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2 Big Reasons Dominion Energy Stock Lost 9% in 2020