The utilities sector actually had negative performance last year in most countries — Russia was a glaring exception — but it may be a better place to play in 2011.
Take a look at Electrobras (EBR, quote), which is one of the biggest utilities in Latin America.
As an integrated power generator and distributor, EBR has scale — market cap is $16 billion — and can capture some efficiencies from playing up and down the value chain. The company also offers decent value right now at just 10.2 times expected 2011 earnings and pays a decent dividend of about 2.1%.
Bonus: The stock is on the move already. Since just after Thanksgiving, EBR is up around 10% in ADR form, which is fairly spectacular when you consider that this sector was left in the water to drown last year and that Brazil is still getting a fairly cold shoulder.
With domestic stories and inflation fears heating up, watch the utilities for more stories like this. Inflation, in particular, makes the dividends these companies distribute more attractive, while domestic expansion is simply good for top-line growth.