How can you do better than a current price-to-book (P/B) value of less than 1.0? You can throw in a dividend yield of 4% that's how! Duke Energy (NYSE: DUK) has been rewarding investors for many years and is likely to continue to do so. Last year it had negative growth which may account for the equally negative sentiment that created this bargain but for value investors I do not see anything but prosperity ahead. You can find it in Chasing down 007 picks: Q1 is done - Valero is tops and the original review Duke Energy: Vote for this boring stock for 2007.

DUK's closing stock price Tuesday, April 10, 2007 was $20.83. It has a reasonable P/E ratio and a higher than average dividend yield.

• Dividend Yield: 4.04%
• Price-to-earnings ratio - P/E: 11.94

The P/S, P/B and P/CF are amazing - do you see what I see Warren?

• Price-to-sales ratio P/S: 1.59
• Price-to-book ratio - P/B: 0.98
• Price-to-cash-flow - P/CF: 8.16

The return-on-equity (ROE), return-on-assets (ROA), and return-on-invested capital (ROIC) are nothing special and reflect the down year they are coming out of, but the profit margin of 11.24% is very good and consistent.

Warren Buffett has said that you should invest in stocks as if you were buying a business. Would I want to own this business - absolutely! However, it is capitalized at just over $26 billion so I would come up a bit shy. I am likely to add to my current shares from time to time.

It also makes sense for those seeking a "defensive" stock to anchor your portfolio into retirement - just like I said about Johnson and Johnson (NYSE: JNJ) last week. And the two would be a great start to a new portfolio.

Sheldon Liber is the CEO of a small private investment company and the vice president for design and research at an architecture & planning firm. Check out his other posts for BloggingStocks here.

Chasing Value: Duke Energy (DUK) originally appeared on BloggingStocks on Wed, 11 Apr 2007 13:55:00 EST. Please see our terms for use of feeds.