Critical Contrast: MYR Group (MYRG) and Aegion (AEGN)

MYR Group (NASDAQ: MYRG) and Aegion (NASDAQ:AEGN) are both small-cap utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

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89.4% of MYR Group shares are held by institutional investors. Comparatively, 93.9% of Aegion shares are held by institutional investors. 4.9% of MYR Group shares are held by insiders. Comparatively, 3.4% of Aegion shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares MYR Group and Aegion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MYR Group 1.51% 4.90% 2.28%
Aegion -5.37% 6.32% 3.02%

Valuation and Earnings

This table compares MYR Group and Aegion’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
MYR Group $1.40 billion 0.36 $21.15 million $0.81 37.75
Aegion $1.36 billion 0.55 -$69.05 million $1.03 22.13

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

Risk and Volatility

MYR Group has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500. Comparatively, Aegion has a beta of 1.7, indicating that its share price is 70% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for MYR Group and Aegion, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MYR Group 0 4 2 0 2.33
Aegion 0 5 1 0 2.17

MYR Group presently has a consensus target price of $34.80, indicating a potential upside of 13.80%. Aegion has a consensus target price of $26.33, indicating a potential upside of 15.55%. Given Aegion’s higher possible upside, analysts clearly believe Aegion is more favorable than MYR Group.

MYR Group Company Profile

MYR Group Inc., through its subsidiaries, provides electrical construction services in the United States and Canada. It operates in two segments, Transmission and Distribution, and Commercial and Industrial. The Transmission and Distribution segment offers a range of services on electric transmission and distribution networks, and substation facilities, including design, engineering, procurement, construction, upgrade, maintenance, and repair services with primary focus on construction, maintenance, and repair to customers in the electric utility and the renewable energy industries. Its services include construction and maintenance of high voltage transmission lines, substations, and lower voltage underground and overhead distribution systems; and emergency restoration services in response to hurricane, ice, or other storm related damages. This segment serves as a prime contractor to customers, such as investor-owned utilities, cooperatives, private developers, government-funded utilities, independent power producers, independent transmission companies, industrial facility owners, and other contractors. The Commercial and Industrial segment provides services, such as design, installation, maintenance, and repair of commercial and industrial wiring; and installation of traffic networks, bridge, roadway, and tunnel lighting. This segment offers its services for airports, hospitals, data centers, hotels, stadiums, convention centers, manufacturing plants, processing facilities, waste-water treatment facilities, mining facilities, and transportation control and management systems. It serves general contractors, commercial and industrial facility owners, local governments, and developers. MYR Group Inc. was founded in 1891 and is headquartered in Rolling Meadows, Illinois.

Aegion Company Profile

Aegion Corporation (Aegion) is engaged in providing infrastructure protection and maintenance. The Company operates through three segments: Infrastructure Solutions, Corrosion Protection and Energy Services. The Company offers service solutions, including rehabilitation of water and wastewater pipelines with Insituform cured-in-place pipe (CIPP) products; fusible polyvinyl chloride products for rehabilitation; fiber reinforced polymer systems for rehabilitation and strengthening; cathodic protection for corrosion engineering control and infrastructure rehabilitation; pipe coatings for corrosion control and prevention; high density polyethylene (HDPE) pipe lining for corrosion control, abrasion protection and pipeline rehabilitation, and construction and maintenance of oil and gas facilities. The Company’s Insituform CIPP Process for the rehabilitation of sewers, pipelines and other conduits utilizes a custom-manufactured tube, or liner, made of synthetic fiber.

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