Critical Analysis: CLP Group (CLPHY) and Pattern Energy Group (PEGI)

CLP Group (OTCMKTS: CLPHY) and Pattern Energy Group (NASDAQ:PEGI) are both utilities companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares CLP Group and Pattern Energy Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CLP Group $11.81 billion 2.20 $1.86 billion N/A N/A
Pattern Energy Group $411.34 million 4.20 -$17.90 million $0.19 92.58

CLP Group has higher revenue and earnings than Pattern Energy Group.

Dividends

CLP Group pays an annual dividend of $0.50 per share and has a dividend yield of 4.9%. Pattern Energy Group pays an annual dividend of $1.69 per share and has a dividend yield of 9.6%. Pattern Energy Group pays out 889.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider & Institutional Ownership

0.1% of CLP Group shares are held by institutional investors. Comparatively, 97.1% of Pattern Energy Group shares are held by institutional investors. 1.7% of Pattern Energy Group shares are held by company 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.

Profitability

This table compares CLP Group and Pattern Energy Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CLP Group N/A N/A N/A
Pattern Energy Group 26.62% 6.17% 2.84%

Analyst Recommendations

This is a summary of recent recommendations for CLP Group and Pattern Energy Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CLP Group 0 0 0 0 N/A
Pattern Energy Group 0 6 7 0 2.54

Pattern Energy Group has a consensus target price of $22.96, suggesting a potential upside of 30.52%. Given Pattern Energy Group’s higher probable upside, analysts plainly believe Pattern Energy Group is more favorable than CLP Group.

Risk & Volatility

CLP Group has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500. Comparatively, Pattern Energy Group has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500.

Summary

Pattern Energy Group beats CLP Group on 10 of the 13 factors compared between the two stocks.

About CLP Group

CLP Holdings Limited, an investment holding company, generates, transmits, and distributes electricity in Hong Kong, Mainland China, India, Southeast Asia, Taiwan, and Australia. The company generates electricity through coal, oil, gas, nuclear, wind, hydro, and solar power plants. It is also involved in the provision of pumped storage and engineering services; research and development activities; property investment; and retail of electricity and gas. As of December 31, 2017 the company had equity generating capacity of 19,395 megawatts (MW) and purchasing capacity of 5, 159 MW. CLP Holdings Limited was founded in 1901 and is based in Kowloon, Hong Kong.

About Pattern Energy Group

Pattern Energy Group Inc., an independent power company, focuses on the construction, ownership, and operation of various power projects in the United States, Canada, and Chile. It holds interests in various wind and solar power projects. The company sells electricity and renewable energy credits primarily to local utilities and local liquid independent system organizations markets. Pattern Energy Group Inc. was founded in 2012 and is headquartered in San Francisco, California.

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