Comparing Cosan (NYSE:CSAN) & Brookfield Renewable (NYSE:BEPC)

Cosan (NYSE:CSAN) and Brookfield Renewable (NYSE:BEPC) are both mid-cap energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Dividends

Cosan pays an annual dividend of $0.31 per share and has a dividend yield of 6.1%. Brookfield Renewable pays an annual dividend of $1.49 per share and has a dividend yield of 3.5%. Cosan pays out -34.1% of its earnings in the form of a dividend. Brookfield Renewable pays out -167.4% 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. Brookfield Renewable has increased its dividend for 1 consecutive years.

Analyst Ratings

This is a summary of current recommendations for Cosan and Brookfield Renewable, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cosan	2	2	1	0	1.80
Brookfield Renewable	1	1	3	0	2.40

Cosan currently has a consensus target price of $9.47, suggesting a potential upside of 86.17%. Brookfield Renewable has a consensus target price of $37.50, suggesting a potential downside of 11.16%. Given Cosan’s higher possible upside, research analysts plainly believe Cosan is more favorable than Brookfield Renewable.

Profitability

This table compares Cosan and Brookfield Renewable’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cosan	-28.08%	-27.61%	-8.25%
Brookfield Renewable	-34.58%	-12.74%	-3.20%

Earnings and Valuation

This table compares Cosan and Brookfield Renewable”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cosan	$43.55 billion	0.05	-$1.75 billion	($0.91)	-5.59
Brookfield Renewable	$5.88 billion	1.04	$236.00 million	($0.89)	-47.43

Brookfield Renewable has lower revenue, but higher earnings than Cosan. Brookfield Renewable is trading at a lower price-to-earnings ratio than Cosan, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Cosan has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.Comparatively, Brookfield Renewable has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500.

Institutional & Insider Ownership

75.1% of Brookfield Renewable shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Brookfield Renewable beats Cosan on 11 of the 16 factors compared between the two stocks.

About Cosan

Cosan S.A. engages in the fuel distribution business. It operates through Raízen, Compass, Moove, Rumo, and Radar segments. The company’s Raízen segment engages in the production, commercialization, origination, and trading of ethanol, bioenergy, renewable sources, and sugar; trading and resale of electricity; and distribution and commercialization of fuels and lubricants. Its Compass segment distributes piped natural gas to industrial, residential, commercial, automotive, and cogeneration customers; and develops infrastructure projects in a regasification terminal, offshore gas pipeline, and thermal generation projects utilizing natural gas, as well as commercialization of electricity and natural gas. The company’s Moove segment produces and distributes lubricants under the Comma brand. Its Rumo segment provides logistics services for rail transportation, port storage, and loading of goods, including grains and sugar; and leases locomotives, wagons, and another railroad equipment, as well as operates containers. The company’s Radar segment manages agricultural property. It operates in Brazil, England, France, Spain and Portugal, Argentina, Bolivia, Uruguay and Paraguay, the United States, Asia, and internationally. Cosan S.A. was founded in 1936 and is headquartered in São Paulo, Brazil.

About Brookfield Renewable

Brookfield Renewable Corporation owns and operates a portfolio of renewable power and sustainable solution assets primarily in the United States, Europe, Colombia, and Brazil. It operates hydroelectric, wind, solar, and distributed energy and sustainable solutions with an installed capacity of approximately 19,161 megawatts. The company was incorporated in 2019 and is headquartered in New York, New York. Brookfield Renewable Corporation operates as a subsidiary of Brookfield BRP Holdings (Canada) Inc.