Alliant Energy (NYSE: LNT) and Consolidated Edison (NYSE:ED) are both utilities companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitability, earnings, risk, institutional ownership and valuation.
This table compares Alliant Energy and Consolidated Edison’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Alliant Energy has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500. Comparatively, Consolidated Edison has a beta of 0.1, meaning that its share price is 90% less volatile than the S&P 500.
This is a summary of recent ratings and target prices for Alliant Energy and Consolidated Edison, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Alliant Energy currently has a consensus price target of $43.40, suggesting a potential upside of 10.43%. Consolidated Edison has a consensus price target of $80.61, suggesting a potential upside of 6.78%. Given Alliant Energy’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Alliant Energy is more favorable than Consolidated Edison.
Alliant Energy pays an annual dividend of $1.34 per share and has a dividend yield of 3.4%. Consolidated Edison pays an annual dividend of $2.86 per share and has a dividend yield of 3.8%. Alliant Energy pays out 67.3% of its earnings in the form of a dividend. Consolidated Edison pays out 13.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Alliant Energy has increased its dividend for 43 consecutive years and Consolidated Edison has increased its dividend for 12 consecutive years. Consolidated Edison is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider and Institutional Ownership
69.9% of Alliant Energy shares are held by institutional investors. Comparatively, 56.8% of Consolidated Edison shares are held by institutional investors. 0.3% of Alliant Energy shares are held by company insiders. Comparatively, 0.2% of Consolidated Edison shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Alliant Energy and Consolidated Edison’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Alliant Energy||$3.38 billion||2.69||$467.50 million||$1.99||19.75|
|Consolidated Edison||$12.03 billion||1.95||$1.53 billion||$21.95||3.44|
Consolidated Edison has higher revenue and earnings than Alliant Energy. Consolidated Edison is trading at a lower price-to-earnings ratio than Alliant Energy, indicating that it is currently the more affordable of the two stocks.
Alliant Energy beats Consolidated Edison on 11 of the 17 factors compared between the two stocks.
Alliant Energy Company Profile
Alliant Energy Corporation operates as a regulated investor-owned public utility holding company. The Company’s segments include Utility and Non-regulated, Parent and Other. The Utility segment includes the operations of Interstate Power and Light Company (IPL) and Wisconsin Power and Light Company (WPL), which serve retail customers in Iowa and Wisconsin. The Utility segment includes utility electric operations, utility gas operations and utility other, which includes steam operations and the unallocated portions of the utility business. Its Non-regulated, Parent and Other segment includes the operations of Alliant Energy Resources, LLC and its subsidiaries; Alliant Energy Corporate Services, Inc. (Corporate Services); the Alliant Energy parent company, and any Alliant Energy parent company consolidating adjustments. IPL and WPL own a portfolio of electric generating units located in Iowa, Wisconsin and Minnesota with a fuel mix, including coal, natural gas and renewable resources.
Consolidated Edison Company Profile
Consolidated Edison, Inc. (Con Edison) is a holding company. The Company operates through its subsidiaries, which include Consolidated Edison Company of New York, Inc. (CECONY), Orange and Rockland Utilities, Inc. (O&R), Con Edison Clean Energy Businesses, Inc. (the Clean Energy Businesses) and Con Edison Transmission, Inc. (Con Edison Transmission). CECONY’s principal business operations are its regulated electric, gas and steam delivery businesses. CECONY provides electricity, natural gas and steam to customers in New York City and Westchester County. O&R’s principal business operations are its regulated electric and gas delivery businesses. The Clean Energy Businesses develop, own and operate renewable and energy infrastructure projects and provide energy-related products and services to wholesale and retail customers. Con Edison Transmission, through its subsidiaries, invests in electric transmission facilities and gas pipeline and storage facilities.
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