Contrasting Pepco (POM) and Its Rivals

Pepco (NYSE: POM) is one of 81 publicly-traded companies in the “Electric Utilities” industry, but how does it weigh in compared to its rivals? We will compare Pepco to related companies based on the strength of its risk, analyst recommendations, dividends, institutional ownership, valuation, earnings and profitability.

Insider and Institutional Ownership

65.6% of shares of all “Electric Utilities” companies are owned by institutional investors. 2.7% of shares of all “Electric Utilities” companies are owned by company 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.

Analyst Recommendations

This is a breakdown of recent ratings for Pepco and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pepco 0 0 0 0 N/A
Pepco Competitors 533 2939 2378 43 2.33

As a group, “Electric Utilities” companies have a potential upside of 7.24%. Given Pepco’s rivals higher possible upside, analysts clearly believe Pepco has less favorable growth aspects than its rivals.

Dividends

Pepco pays an annual dividend of $1.08 per share and has a dividend yield of 4.0%. Pepco pays out 86.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Electric Utilities” companies pay a dividend yield of 3.2% and pay out 58.0% of their earnings in the form of a dividend.

Earnings & Valuation

This table compares Pepco and its rivals revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Pepco N/A N/A 21.54
Pepco Competitors $7.66 billion $831.80 million 50.45

Pepco’s rivals have higher revenue and earnings than Pepco. Pepco is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Pepco and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pepco 10.52% 11.08% 2.95%
Pepco Competitors -10.18% 9.37% 2.56%

Summary

Pepco rivals beat Pepco on 5 of the 9 factors compared.

About Pepco

Pepco Holdings LLC, formerly Pepco Holdings, Inc., is a holding company. The Company, through its utility subsidiaries, is engaged in the transmission, distribution and default supply of electricity, and the distribution and supply of natural gas. The Company’s segments include Power Delivery, Pepco Energy Services, and Corporate and Other. The Company’s subsidiaries include Potomac Electric Power Company (Pepco), Delmarva Power & Light Company (DPL) and Atlantic City Electric Company (ACE). Pepco is engaged in the transmission, distribution and default supply of electricity. DPL is involved in the transmission, distribution and default supply of electricity, and distribution and supply of natural gas. ACE is engaged in the transmission, distribution and default supply of electricity. The Company’s subsidiaries own and operate a network of wires, substations and other equipment that are classified as transmission facilities, distribution facilities or common facilities.

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