Financial Analysis: Consolidated Edison (ED) versus United Utilities Group (UUGRY)

Consolidated Edison (NYSE: ED) and United Utilities Group (OTCMKTS:UUGRY) are both utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.

Valuation and Earnings

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This table compares Consolidated Edison and United Utilities Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Consolidated Edison $12.03 billion 2.03 $1.53 billion $4.09 19.21
United Utilities Group $2.31 billion 3.06 $567.23 million N/A N/A

Consolidated Edison has higher revenue and earnings than United Utilities Group.

Profitability

This table compares Consolidated Edison and United Utilities Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Consolidated Edison 12.67% 8.51% 2.60%
United Utilities Group N/A N/A N/A

Insider & Institutional Ownership

56.7% of Consolidated Edison shares are held by institutional investors. Comparatively, 0.2% of United Utilities Group shares are held by institutional investors. 0.2% of Consolidated Edison shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Consolidated Edison has a beta of 0.05, indicating that its stock price is 95% less volatile than the S&P 500. Comparatively, United Utilities Group has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500.

Dividends

Consolidated Edison pays an annual dividend of $2.86 per share and has a dividend yield of 3.6%. United Utilities Group pays an annual dividend of $1.01 per share and has a dividend yield of 4.9%. Consolidated Edison pays out 69.9% of its earnings in the form of a dividend. Consolidated Edison has increased its dividend for 43 consecutive years.

Analyst Recommendations

This is a summary of current recommendations and price targets for Consolidated Edison and United Utilities Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Consolidated Edison 4 5 1 0 1.70
United Utilities Group 0 3 2 0 2.40

Consolidated Edison presently has a consensus price target of $80.61, suggesting a potential upside of 2.61%. Given Consolidated Edison’s higher possible upside, research analysts plainly believe Consolidated Edison is more favorable than United Utilities Group.

Summary

Consolidated Edison beats United Utilities Group on 9 of the 15 factors compared between the two stocks.

Consolidated Edison Company Profile

Consolidated Edison, Inc. (Con Edison) is a holding company. The Company operates through its subsidiaries, which include Consolidated Edison Company of New York, Inc. (CECONY), Orange and Rockland Utilities, Inc. (O&R), Con Edison Clean Energy Businesses, Inc. (the Clean Energy Businesses) and Con Edison Transmission, Inc. (Con Edison Transmission). CECONY’s principal business operations are its regulated electric, gas and steam delivery businesses. CECONY provides electricity, natural gas and steam to customers in New York City and Westchester County. O&R’s principal business operations are its regulated electric and gas delivery businesses. The Clean Energy Businesses develop, own and operate renewable and energy infrastructure projects and provide energy-related products and services to wholesale and retail customers. Con Edison Transmission, through its subsidiaries, invests in electric transmission facilities and gas pipeline and storage facilities.

United Utilities Group Company Profile

United Utilities Group PLC is a water company. The Company, through its subsidiary, United Utilities Water Limited (United Utilities Water), manages the regulated water and wastewater network in the North West of England, providing services to around seven million people and businesses. It owns over 55,000 hectares of land around its reservoirs. It collects water from the environment, clean and distributes it to its customers before collecting it, treating it, and then returning it back to the environment. The Company produced approximately 138 Gigawatt hours (GWh) of renewable energy through sludge treatment centers and solar installations, enough to power over 40,000 homes. It delivers approximately 1,700 million liters of clean drinking water to its customers every day through over 40,000 kilometers of water pipes. United Utilities Water holds licenses to provide water and wastewater services to a population of approximately seven million people in the North West of England.

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