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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: Steve Felix who wrote (976)	1/18/2008 4:20:34 PM
From: John F. Poteraske	Read Replies (1) \| Respond to of 34328

"He says that he has heard of the company and that they mostly are in Sao Paulo. He thinks they are a distributor only, but not sure" Just started looking at company, but from url provided saw this: -CPFL Energia is a holding company in Brazilian electricity sector, operating through its subsidiaries in the distribution, generation and commercialization of electricity, in free and regulated markets. -Operation in the States of São Paulo, Paraná and Rio Grande do Sul, three major economic and industrial centers in Brazil

To: Steve Felix who wrote (976)	2/27/2008 7:29:38 AM
From: John F. Poteraske	Respond to of 34328

Caught this article which has CPL in: Betting Beyond Buffett in Brazil: news.morningstar.com In Brazil, sales of electricity-thirsty appliances and electronics goods surged by 16% in the last year alone. Manufacturers aren't the only ones smiling; the utilities that power these goods are, too. Of these, CPFL Energia is the best, in our opinion. Unlike some of its peers, CPFL's returns exceed its cost of capital--and we expect they will only strengthen. Scale and natural monopoly status confer CPFL a sustainable competitive advantage. The firm's difficult-to-replicate distribution networks, which are concentrated in the economically vibrant southern states of Sao Paulo and Rio Grande do Sul, represent a sizable barrier to entry. We expect that CPFL will build further scale as it acquires local utilities in the fragmented Brazilian market. Rising per-capita consumption (currently one fifth of U.S. levels) will also help drive CPFL's top line. Operating costs, meanwhile, should remain in check, as Brazil's reformed regulatory system rewards efficiency. On the downside, a widespread drought could entail power rationing in Brazil's hydro-dependent electricity market. Rationing would squeeze CPFL's margins, as revenue would fall while costs remained largely fixed. An economic downturn would lead to similar challenges. Despite these risks, we think CPFL's investor-oriented management, attractive service territories, and operating scale more than compensate.