Analyzing Vistra (NYSE:VST) & Iberdrola (OTCMKTS:IBDRY)

Iberdrola (OTCMKTS:IBDRY) and Vistra (NYSE:VST) are both large-cap utilities companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, institutional ownership, risk and dividends.

Dividends

Iberdrola pays an annual dividend of $2.98 per share and has a dividend yield of 3.7%. Vistra pays an annual dividend of $0.90 per share and has a dividend yield of 0.5%. Iberdrola pays out 82.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Vistra pays out 14.4% of its earnings in the form of a dividend. Vistra has increased its dividend for 6 consecutive years.

Earnings & Valuation

This table compares Iberdrola and Vistra”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Iberdrola	$48.42 billion	2.79	$6.07 billion	$3.61	22.42
Vistra	$17.22 billion	3.80	$2.66 billion	$6.27	30.79

Iberdrola has higher revenue and earnings than Vistra. Iberdrola is trading at a lower price-to-earnings ratio than Vistra, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Iberdrola has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Vistra has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500.

Profitability

This table compares Iberdrola and Vistra’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Iberdrola	12.10%	9.22%	3.49%
Vistra	12.90%	108.41%	7.71%

Insider & Institutional Ownership

0.0% of Iberdrola shares are held by institutional investors. Comparatively, 90.9% of Vistra shares are held by institutional investors. 1.4% of Vistra shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for Iberdrola and Vistra, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Iberdrola	1	2	2	0	2.20
Vistra	0	2	12	4	3.11

Vistra has a consensus price target of $229.93, indicating a potential upside of 19.10%. Given Vistra’s stronger consensus rating and higher possible upside, analysts clearly believe Vistra is more favorable than Iberdrola.

Summary

Vistra beats Iberdrola on 15 of the 18 factors compared between the two stocks.

About Iberdrola

Iberdrola, S.A. engages in the generation, transmission, distribution, and supply of electricity in Spain, the United Kingdom, the United States, Mexico, Brazil, Germany, France, and Australia. It generates electricity from renewable sources, such as onshore and offshore wind, hydro, photovoltaic, combined cycle gas, and conventional nuclear, as well as through batteries. The company is also involved in the purchase and sale of electricity and gas on wholesale markets; energy retail supply activities, such as gas and electricity, and other products and services, including hydrogen, as well as non-renewable generation; and production of green hydrogen. It has a total installed capacity of 62,871 MW. In addition, the company offers heat pumps, self-consumption, electric mobility, solar, etc. services to residential customers; and management of energy facilities, as well as supplies green H2, industrial heat, etc. to industrial customers. Iberdrola, S.A. was founded in 1840 and is based in Bilbao, Spain.

About Vistra

Vistra Corp., together with its subsidiaries, operates as an integrated retail electricity and power generation company. The company operates through six segments: Retail, Texas, East, West, Sunset, and Asset Closure. It retails electricity and natural gas to residential, commercial, and industrial customers across states in the United States and the District of Columbia. In addition, the company is involved in the electricity generation, wholesale energy purchases and sales, commodity risk management, fuel production, and fuel logistics management activities. It serves approximately 4 million customers with a generation capacity of approximately 37,000 megawatts with a portfolio of natural gas, nuclear, coal, solar, and battery energy storage facilities. The company was formerly known as Vistra Energy Corp. and changed its name to Vistra Corp. in July 2020. Vistra Corp. was founded in 1882 and is based in Irving, Texas.