MGE Energy (NASDAQ:MGEE – Get Free Report) and Eversource Energy (NYSE:ES – Get Free Report) are both utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitability and earnings.
Profitability
This table compares MGE Energy and Eversource Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| MGE Energy | 19.45% | 11.10% | 4.74% |
| Eversource Energy | 10.35% | 11.33% | 2.91% |
Earnings and Valuation
This table compares MGE Energy and Eversource Energy”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| MGE Energy | $743.65 million | 4.00 | $135.89 million | $4.07 | 19.33 |
| Eversource Energy | $13.55 billion | 1.95 | $1.69 billion | $3.86 | 18.20 |
Eversource Energy has higher revenue and earnings than MGE Energy. Eversource Energy is trading at a lower price-to-earnings ratio than MGE Energy, indicating that it is currently the more affordable of the two stocks.
Dividends
MGE Energy pays an annual dividend of $1.90 per share and has a dividend yield of 2.4%. Eversource Energy pays an annual dividend of $3.15 per share and has a dividend yield of 4.5%. MGE Energy pays out 46.7% of its earnings in the form of a dividend. Eversource Energy pays out 81.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MGE Energy has raised its dividend for 49 consecutive years and Eversource Energy has raised its dividend for 2 consecutive years.
Institutional and Insider Ownership
52.6% of MGE Energy shares are owned by institutional investors. Comparatively, 80.0% of Eversource Energy shares are owned by institutional investors. 0.4% of MGE Energy shares are owned by company insiders. Comparatively, 0.2% of Eversource Energy shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Risk & Volatility
MGE Energy has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, Eversource Energy has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for MGE Energy and Eversource Energy, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| MGE Energy | 1 | 1 | 1 | 0 | 2.00 |
| Eversource Energy | 3 | 6 | 4 | 0 | 2.08 |
MGE Energy presently has a consensus target price of $77.50, suggesting a potential downside of 1.47%. Eversource Energy has a consensus target price of $72.92, suggesting a potential upside of 3.80%. Given Eversource Energy’s stronger consensus rating and higher possible upside, analysts plainly believe Eversource Energy is more favorable than MGE Energy.
Summary
MGE Energy beats Eversource Energy on 9 of the 17 factors compared between the two stocks.
About MGE Energy
MGE Energy, Inc., through its subsidiaries, operates as a public utility holding company primarily in the United States. It operates through Regulated Electric Utility Operations; Regulated Gas Utility Operations; Nonregulated Energy Operations; Transmission Investments; and All Other segments. The company generates, purchases, and distributes electricity and natural gas in Wisconsin and Iowa; owns and leases electric generating capacity; and plans, constructs, operates, maintains, and expands transmission facilities to provide transmission power services. It generates electricity from coal-fired, gas-fired, and renewable energy sources. As of December 31, 2023, the company owned and operated 835 miles of overhead electric distribution lines; 1,330 miles of underground electric distribution cables; 49 substations with an installed capacity of 1.2 million kVA; and gas facilities, including 3,066 miles of distribution mains, as well as supplied electric service to approximately 163,000 customers. MGE Energy, Inc. founded in 2001 and is headquartered in Madison, Wisconsin.
About Eversource Energy
Eversource Energy, a public utility holding company, engages in the energy delivery business. The company operates through Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution segments. It is involved in the transmission and distribution of electricity; solar power facilities; and distribution of natural gas. The company operates regulated water utilities that provide water services to approximately 241,000 customers. It serves residential, commercial, industrial, municipal and fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. Eversource Energy was incorporated in 1927 and is headquartered in Springfield, Massachusetts.
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