Reviewing Pacific Gas & Electric (NYSE:PCG) & DTE Energy (NYSE:DTE)

DTE Energy (NYSE:DTE) and Pacific Gas & Electric (NYSE:PCG) are both large-cap utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, profitability, risk, dividends, earnings and analyst recommendations.

Volatility and Risk

DTE Energy has a beta of 0.49, meaning that its stock price is 51% less volatile than the S&P 500. Comparatively, Pacific Gas & Electric has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.

Dividends

DTE Energy pays an annual dividend of $4.66 per share and has a dividend yield of 3.4%. Pacific Gas & Electric pays an annual dividend of $0.20 per share and has a dividend yield of 1.3%. DTE Energy pays out 70.0% of its earnings in the form of a dividend. Pacific Gas & Electric pays out 16.8% 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. DTE Energy has increased its dividend for 16 consecutive years and Pacific Gas & Electric has increased its dividend for 1 consecutive years. DTE Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings and price targets for DTE Energy and Pacific Gas & Electric, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DTE Energy	0	4	9	0	2.69
Pacific Gas & Electric	1	6	7	0	2.43

DTE Energy presently has a consensus target price of $147.67, suggesting a potential upside of 7.73%. Pacific Gas & Electric has a consensus target price of $20.64, suggesting a potential upside of 36.01%. Given Pacific Gas & Electric’s higher possible upside, analysts plainly believe Pacific Gas & Electric is more favorable than DTE Energy.

Profitability

This table compares DTE Energy and Pacific Gas & Electric’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DTE Energy	9.34%	12.63%	2.99%
Pacific Gas & Electric	10.93%	11.10%	2.42%

Insider and Institutional Ownership

76.1% of DTE Energy shares are owned by institutional investors. Comparatively, 78.6% of Pacific Gas & Electric shares are owned by institutional investors. 0.3% of DTE Energy shares are owned by insiders. Comparatively, 0.1% of Pacific Gas & Electric shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares DTE Energy and Pacific Gas & Electric”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DTE Energy	$12.46 billion	2.29	$1.40 billion	$6.66	20.58
Pacific Gas & Electric	$24.42 billion	1.37	$2.51 billion	$1.19	12.75

Pacific Gas & Electric has higher revenue and earnings than DTE Energy. Pacific Gas & Electric is trading at a lower price-to-earnings ratio than DTE Energy, indicating that it is currently the more affordable of the two stocks.

Summary

DTE Energy beats Pacific Gas & Electric on 11 of the 17 factors compared between the two stocks.

About DTE Energy

DTE Energy Company engages in the utility operations. The company's Electric segment generates, purchases, distributes, and sells electricity to various residential, commercial, and industrial customers in southeastern Michigan. It generates electricity through coal-fired plants, hydroelectric pumped storage, and nuclear plants, as well as wind and solar assets. This segment owns and operates distribution substations and line transformers. The company's Gas segment purchases, stores, transports, distributes, and sells natural gas to various residential, commercial, and industrial customers throughout Michigan; and sells storage and transportation capacity. Its DTE Vantage segment offers metallurgical and petroleum coke to steel and other industries; and power generation, steam production, chilled water production, and wastewater treatment services, as well as air supplies compressed air to industrial customers. Its Energy Trading segment engages in power, natural gas, and environmental marketing and trading; structured transactions; and the optimization of contracted natural gas pipeline transportation and storage positions. The company was founded in 1849 and is based in Detroit, Michigan.

About Pacific Gas & Electric

PG&E Corp. operates as a holding company, which engages in generation, transmission, and distribution of electricity and natural gas to customers. It specializes in energy, utility, power, gas, electricity, solar and sustainability. The company was founded in 1995 and is headquartered in Oakland, CA.