Good Argus Report: ETR is trading at 15.5-times our 2008 EPS estimate, a discount to electric utilities with large, higher-return merchant power operations. Based on the company’s growing financial strength, manageable risk profile, continued focus on nonregulated activities (but not to the exclusion of the regulated side), clearer earnings visibility, wellmanaged nuclear power plant assets and good relations with state regulators, we think the P/E multiple will expand significantly over the next 12 months. Added pluses are strong cost controls and the fact that all employees have done a remarkable job in bringing the company back from the brink after Hurricanes Rita and Katrina. Our 12-month target price of $129, together with the dividend yield of 2.0%, suggests a potential 12-month total return of more than 20%.

The Giant of the South.

$0.41 dividend on $40 stock

Robust cash earnings and dividend yields higher than 2%.