Northwest Natural Gas (NYSE: NWN) and Centrica (OTCMKTS:CPYYY) are both utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.
Risk and Volatility
Northwest Natural Gas has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500. Comparatively, Centrica has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500.
This table compares Northwest Natural Gas and Centrica’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
|Northwest Natural Gas
Valuation & Earnings
This table compares Northwest Natural Gas and Centrica’s top-line revenue, earnings per share (EPS) and valuation.
||Earnings Per Share
|Northwest Natural Gas
Centrica has higher revenue and earnings than Northwest Natural Gas.
Insider and Institutional Ownership
68.0% of Northwest Natural Gas shares are owned by institutional investors. Comparatively, 0.1% of Centrica shares are owned by institutional investors. 1.5% of Northwest Natural Gas shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Northwest Natural Gas pays an annual dividend of $1.89 per share and has a dividend yield of 3.3%. Centrica pays an annual dividend of $0.60 per share and has a dividend yield of 7.6%. Northwest Natural Gas pays out -97.4% of its earnings in the form of a dividend. Northwest Natural Gas has increased its dividend for 62 consecutive years.
This is a breakdown of current recommendations for Northwest Natural Gas and Centrica, as provided by MarketBeat.
||Strong Buy Ratings
|Northwest Natural Gas
Northwest Natural Gas currently has a consensus price target of $59.33, suggesting a potential upside of 4.09%. Given Northwest Natural Gas’ higher probable upside, analysts clearly believe Northwest Natural Gas is more favorable than Centrica.
Northwest Natural Gas beats Centrica on 8 of the 15 factors compared between the two stocks.
Northwest Natural Gas Company Profile
Northwest Natural Gas Company (NW Natural) is engaged in the distribution of natural gas. The Company’s segments include Local Gas Distribution, Gas Storage and other. The Company maintains operations in Oregon, Washington and California and conducts businesses through NW Natural and its subsidiaries. The local gas distribution business, referred to as the utility segment, serves residential, commercial, and industrial customers in Oregon and southwest Washington. The Company’s gas storage business, referred to as the gas storage segment, provides storage services for utilities, gas marketers, electric generators and industrial users from storage facilities located in Oregon and California. The Company’s other segment is referred to as non-utility and consists of non-utility investments and other business activities. The other segment consists of an equity method investment in Trail West Holdings, LLC (TWH) and other pipeline assets in NNG Financial Corporation.
Centrica Company Profile
Centrica plc is an energy and services company. The Company’s segments include Energy Supply & Services-UK & Ireland, Energy Supply & Services-North America, Connected Home, Distributed Energy & Power, Energy Marketing & Trading, Exploration & Production, Central Power Generation and Centrica Storage. The Energy Supply & Services-UK & Ireland segment includes UK Home, UK Business and Ireland. The Energy Supply & Services-North America segment includes NA Home and NA Business. The Company is engaged in the supply of gas and electricity to residential customers in the United Kingdom, and the installation, repair and maintenance of domestic central heating, plumbing and drains, gas appliances and kitchen appliances, including the provision of fixed-fee maintenance/breakdown service and insurance contracts in the United Kingdom. The Company is engaged in the supply of gas and electricity and provision of energy-related services to business customers in the United Kingdom.
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