Consider FPL Group, because the Gold Coast is still there, recession and all

FPL Group is the holding company for electric utility Florida Light & Power. Right now, you're probably saying -- whoa! A Florida play? With all those foreclosures, and overbuilt housing complexes, and Florida's slumping economy? Doesn't sound too promising.

Well, the reality is that Florida Light provides electricity to about 4.5 million customers, covering nearly all of Florida's eastern seaboard, as well as the southern part of the state, including the Gold Coast. Now Florida's economy is slumping, but the area does not look like the trench warfare zones of World War I.

Florida Light operates in a publicly-regulated, yet corporate-friendly regulatory environment. True, new electricity accounts may underperform, but existing accounts, combined with revenue for new, wind power investments and renewed, higher-margin power contracts should mean FPL will approach 4-7% earnings growth in 2009; not great, but given current economic conditions, that's just fine.

Further, FPL's shares were hammered during the start of the financial crisis in October 2008, and the view from view argues that with a p/e of 11, they're still a bargain in the $42-50 range. The First Call FY 2009/FY 2010 EPS estimates for FPL are $4.07/$4.54.

Stock Analysis: FPL Group is a moderate-risk stock. Consider buying a 25% position in FPL now; then buy another 25% in three months, if U.S. economic conditions don't worsen substantially. Under any circumstance, don't buy more than 50% of your FPL position in the first half of 2009. Sell/Stop Loss if you were to buy shares in this company: $27.

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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.