Ameren (NYSE:AEE) versus Equatorial Energia (OTCMKTS:EQUEY) Head to Head Review

Equatorial Energia (OTCMKTS:EQUEY) and Ameren (NYSE:AEE) are both utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, dividends, valuation and institutional ownership.

Institutional and Insider Ownership

0.0% of Equatorial Energia shares are held by institutional investors. Comparatively, 79.1% of Ameren shares are held by institutional investors. 0.3% of Ameren shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Equatorial Energia and Ameren”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equatorial Energia	N/A	N/A	N/A	$0.25	29.30
Ameren	$8.80 billion	3.33	$1.46 billion	$5.68	18.65

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

Dividends

Equatorial Energia pays an annual dividend of $0.07 per share and has a dividend yield of 1.0%. Ameren pays an annual dividend of $3.00 per share and has a dividend yield of 2.8%. Equatorial Energia pays out 29.7% of its earnings in the form of a dividend. Ameren pays out 52.8% 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. Ameren has raised its dividend for 12 consecutive years. Ameren is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Equatorial Energia and Ameren’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equatorial Energia	N/A	N/A	N/A
Ameren	17.86%	10.95%	3.00%

Analyst Ratings

This is a summary of current recommendations for Equatorial Energia and Ameren, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equatorial Energia	0	0	0	0	0.00
Ameren	0	3	10	0	2.77

Ameren has a consensus target price of $121.42, suggesting a potential upside of 14.59%. Given Ameren’s stronger consensus rating and higher possible upside, analysts plainly believe Ameren is more favorable than Equatorial Energia.

Summary

Ameren beats Equatorial Energia on 12 of the 14 factors compared between the two stocks.

About Equatorial Energia

Equatorial Energia S.A., through its subsidiaries, engages in the electricity generation, distribution, transmission, and sanitation operations in Brazil. It operates through Distribution, Transmission, Wind Generation, Services, Sanitation, and Other segments. The company generates energy from wind, solar, biomass, qualified co-generation, and hydroelectric plants. It also distributes electric energy in the 217 municipalities of Maranhão State with a concession area of approximately 332,000 square kilometers serving approximately 2.5 million consumers; and 144 municipalities of Pará State with a concession area covering 1,248,000 square kilometers serving approximately 2.6 million consumers. In addition, the company distributes electric energy to 224 municipalities of Piauí State with a concession area covering 251,000 square kilometers serving approximately 1.3 million consumers; 102 municipalities of Alagoas State with a concession area covering 27,848 square kilometers serving approximately 1.2 million consumers; 16 municipalities of Amapá State serving approximately 209,000 consumers; and 72 municipalities of Rio de Janeiro State serving approximately 1.8 million consumers. Equatorial Energia S.A. was founded in 1958 and is based in Brasília, Brazil.

About Ameren

Ameren Corporation, together with its subsidiaries, operates as a public utility holding company in the United States. The company operates through four segments: Ameren Missouri, Ameren Illinois Electric Distribution, Ameren Illinois Natural Gas, and Ameren Transmission. It engages in the rate-regulated electric generation, transmission, and distribution activities; and rate-regulated natural gas distribution business. In addition, the company generates electricity through coal, nuclear, and natural gas, as well as renewable sources, such as hydroelectric, wind, methane gas, and solar. It serves residential, commercial, and industrial customers. The company was founded in 1881 and is headquartered in Saint Louis, Missouri.