Head to Head Analysis: Snam (OTCMKTS:SNMRY) versus Southwest Gas (NYSE:SWX)

Southwest Gas (NYSE:SWX) and Snam (OTCMKTS:SNMRY) are both utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, institutional ownership, profitability, dividends, analyst recommendations and valuation.

Valuation and Earnings

This table compares Southwest Gas and Snam”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southwest Gas	$1.74 billion	3.86	$439.83 million	$7.66	12.10
Snam	N/A	N/A	N/A	$0.65	20.29

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

Profitability

This table compares Southwest Gas and Snam’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southwest Gas	31.85%	6.91%	2.64%
Snam	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings and target prices for Southwest Gas and Snam, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southwest Gas	0	1	6	1	3.00
Snam	0	3	0	1	2.50

Southwest Gas currently has a consensus target price of $98.29, suggesting a potential upside of 6.07%. Given Southwest Gas’ stronger consensus rating and higher possible upside, analysts clearly believe Southwest Gas is more favorable than Snam.

Insider & Institutional Ownership

92.8% of Southwest Gas shares are held by institutional investors. Comparatively, 0.0% of Snam shares are held by institutional investors. 0.6% of Southwest Gas shares are held 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.

Dividends

Southwest Gas pays an annual dividend of $2.58 per share and has a dividend yield of 2.8%. Snam pays an annual dividend of $0.46 per share and has a dividend yield of 3.5%. Southwest Gas pays out 33.7% of its earnings in the form of a dividend. Snam pays out 70.3% 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.

Summary

Southwest Gas beats Snam on 11 of the 13 factors compared between the two stocks.

About Southwest Gas

Southwest Gas Holdings, Inc., through its subsidiaries, distributes and transports natural gas in Arizona, Nevada, and California. The company operates through Natural Gas Distribution, Utility Infrastructure Services, and Pipeline and Storage segments. It also provides trenching, installation, and replacement of underground pipes, as well as maintenance services for energy distribution systems. As of December 31, 2023, it had 2,226,000 residential, commercial, industrial, and other natural gas customers. Southwest Gas Holdings, Inc. was incorporated in 1931 and is headquartered in Las Vegas, Nevada.

About Snam

Snam S.p.A., together with its subsidiaries, engages in the operation of natural gas transport and storage infrastructure. The company operates through Transportation, Storage, Regasification, Energy Transition, and other segments. It provides natural gas transportation and dispatching services; and owns and manages liquified natural gas (LNG) regasification plants. The company also offers natural gas storage services through an integrated group of infrastructure comprising deposits, wells, gas treatment and compression plants, and the operational dispatching systems; and operates storage concessions located in Lombardy, Emilia-Romagna, and Abruzzo. In addition, it provides energy efficiency solutions for companies, condominiums, tertiary, and public administration sectors; and invests, constructs, develops, and operates biogas and biomethane plants. Further, the company offers engineering support and consulting services in technical and specialized fields; and sells automotive compressed natural gas (CNG) compressors. It operates a natural gas transportation network of approximately 38,000 kilometers in Italy, Austria, Tunisia, Egypt, the United Arab Emirates, France, Greece, and the United Kingdom. The company was formerly known as Snam Rete Gas S.p.A. and changed its name to Snam S.p.A. in January 2012. Snam S.p.A. was founded in 1941 and is headquartered in San Donato Milanese, Italy.