Contrasting Dominion Energy (NYSE:D) and Black Hills (NYSE:BKH)

Dominion Energy (NYSE:D) and Black Hills (NYSE:BKH) are both utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, risk, earnings, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of current ratings for Dominion Energy and Black Hills, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dominion Energy	1	8	4	1	2.36
Black Hills	0	1	6	1	3.00

Dominion Energy currently has a consensus price target of $69.33, indicating a potential upside of 1.61%. Black Hills has a consensus price target of $85.00, indicating a potential downside of 1.61%. Given Dominion Energy’s higher probable upside, analysts clearly believe Dominion Energy is more favorable than Black Hills.

Profitability

This table compares Dominion Energy and Black Hills’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dominion Energy	13.99%	10.09%	2.75%
Black Hills	13.49%	8.19%	2.99%

Volatility and Risk

Dominion Energy has a beta of 0.62, suggesting that its share price is 38% less volatile than the S&P 500. Comparatively, Black Hills has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500.

Dividends

Dominion Energy pays an annual dividend of $2.67 per share and has a dividend yield of 3.9%. Black Hills pays an annual dividend of $2.81 per share and has a dividend yield of 3.3%. Dominion Energy pays out 88.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Black Hills pays out 67.5% of its earnings in the form of a dividend. Black Hills has increased its dividend for 55 consecutive years.

Institutional and Insider Ownership

73.0% of Dominion Energy shares are owned by institutional investors. Comparatively, 86.7% of Black Hills shares are owned by institutional investors. 0.1% of Dominion Energy shares are owned by company insiders. Comparatively, 0.6% of Black Hills shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Dominion Energy and Black Hills”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dominion Energy	$16.51 billion	3.64	$3.00 billion	$3.01	22.67
Black Hills	$2.31 billion	2.85	$291.60 million	$4.16	20.77

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

Summary

Black Hills beats Dominion Energy on 10 of the 17 factors compared between the two stocks.

About Dominion Energy

Dominion Energy, Inc. produces and distributes energy in the United States. It operates through three operating segments: Dominion Energy Virginia, Dominion Energy South Carolina, and Contracted Energy. The Dominion Energy Virginia segment generates, transmits, and distributes regulated electricity to approximately 2.8 million residential, commercial, industrial, and governmental customers in Virginia and North Carolina. The Dominion Energy South Carolina segment generates, transmits, and distributes electricity to approximately 0.8 million customers in the central, southern, and southwestern portions of South Carolina; and distributes natural gas to approximately 0.4 million residential, commercial, and industrial customers in South Carolina. The Contracted Energy segment is involved in the nonregulated long-term contracted renewable electric generation and renewable natural gas facility. As of December 31, 2023, the company's portfolio of assets included approximately 29.5 gigawatt of electric generating capacity; 10,600 miles of electric transmission lines; 79,300 miles of electric distribution lines; and 94,800 miles of gas distribution mains and related service facilities. The company was formerly known as Dominion Resources, Inc. Dominion Energy, Inc. was incorporated in 1983 and is headquartered in Richmond, Virginia.

About Black Hills

Black Hills Corporation, through its subsidiaries, operates as an electric and natural gas utility company in the United States. The company operates in two segments: Electric Utilities and Gas Utilities. The Electric Utilities segment generates, transmits, and distributes electricity to approximately 222,000 electric utility customers in Colorado, Montana, South Dakota, and Wyoming; and owns and operates 1,394 megawatts of generation capacity and 9,106 miles of electric transmission and distribution lines. The Gas Utilities segment distributes natural gas to approximately 1,116,000 natural gas utility customers in Arkansas, Colorado, Iowa, Kansas, Nebraska, and Wyoming; owns and operates 4,663 miles of intrastate gas transmission pipelines; 42,514 miles of gas distribution mains and service lines; seven natural gas storage sites; and approximately 50,000 horsepower of compression and 516 miles of gathering lines. It also constructs and maintains customer owned gas infrastructure facilities for gas transportation customers; and provides appliance repair services to residential utility customers, as well as electrical system construction services to large industrial customers. In addition, the company produces electric power through wind, natural gas, and coal-fired generating plants; and coal at its coal mine located near Gillette, Wyoming. Black Hills Corporation was incorporated in 1941 and is headquartered in Rapid City, South Dakota.