NRG Energy (NRG) and Enel Generacion Chile (EOCC) Head-To-Head Review

NRG Energy (NYSE: NRG) and Enel Generacion Chile (NYSE:EOCC) are both mid-cap utilities companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends and valuation.

Insider and Institutional Ownership

97.3% of NRG Energy shares are owned by institutional investors. Comparatively, 2.3% of Enel Generacion Chile shares are owned by institutional investors. 0.3% of NRG Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Volatility & Risk

NRG Energy has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500. Comparatively, Enel Generacion Chile has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500.

Dividends

NRG Energy pays an annual dividend of $0.12 per share and has a dividend yield of 0.4%. Enel Generacion Chile pays an annual dividend of $1.14 per share and has a dividend yield of 4.1%. NRG Energy pays out -2.4% of its earnings in the form of a dividend. Enel Generacion Chile pays out 54.5% 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.

Earnings and Valuation

This table compares NRG Energy and Enel Generacion Chile’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NRG Energy $12.35 billion 0.74 -$774.00 million ($5.10) -5.63
Enel Generacion Chile $2.46 billion 3.08 $614.32 million $2.09 13.26

Enel Generacion Chile has lower revenue, but higher earnings than NRG Energy. NRG Energy is trading at a lower price-to-earnings ratio than Enel Generacion Chile, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares NRG Energy and Enel Generacion Chile’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NRG Energy -13.48% 8.82% 1.25%
Enel Generacion Chile N/A N/A N/A

Analyst Ratings

This is a breakdown of recent ratings and price targets for NRG Energy and Enel Generacion Chile, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NRG Energy 0 1 6 0 2.86
Enel Generacion Chile 2 0 0 0 1.00

NRG Energy presently has a consensus target price of $25.00, indicating a potential downside of 12.89%. Enel Generacion Chile has a consensus target price of $24.20, indicating a potential downside of 12.67%. Given Enel Generacion Chile’s higher probable upside, analysts plainly believe Enel Generacion Chile is more favorable than NRG Energy.

Summary

NRG Energy beats Enel Generacion Chile on 10 of the 16 factors compared between the two stocks.

About NRG Energy

NRG Energy, Inc. (NRG) is an integrated power company. The Company is engaged in producing, selling and delivering electricity and related products and services in various markets in the United States. The Company’s segments include Generation, Retail, Renewables, NRG Yield, Inc. (NRG Yield) and Corporate activities. The Generation segment includes generation, international and Boston Energy Trading and Marketing LLC (BETM). The Retail segment includes Mass customers and Business Solutions. Its Business Solutions include commercial, industrial and governmental/institutional (C&I) customers, and other distributed and reliability products. The Renewables segment includes solar and wind assets. The NRG Yield segment includes certain of the Company’s contracted generation assets. The corporate activities segment includes residential solar and electric vehicle services. The Company owned and operated approximately 47,000 megawatts (MW) of generation, as of December 31, 2016.

About Enel Generacion Chile

Enel Generacion Chile SA, formerly Empresa Nacional De Electricidad SA, is a Chile-based company engaged in the business of electricity generation. The Company operates in Chile. The Company owns and operates a total of approximately 111-generation units in Chile both directly and through its subsidiaries, Pehuenche, Celta and GasAtacama. Of these generation units, approximately 38 are hydroelectric, with a total installed capacity of over 3,470 megawatts. There are approximately 22 thermal generation units that operate with gas, coal or oil with a total installed capacity of over 2,808 megawatts. There are over 51 wind powered generation units with an aggregate installed capacity of approximately 78 megawatts. The Company’s subsidiaries include Compania Electrica San Isidro S.A. (San Isidro), Compania Electrica Tarapaca S.A. (Celta), Empresa Electrica Pehuenche S.A. (Pehuenche) and GasAtacama S.A (GasAtacama). It is controlled by Enel Chile SA.

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