Financial Analysis: Premier (PRHL) versus CenterPoint Energy (CNP)

CenterPoint Energy (NYSE: CNP) and Premier (OTCMKTS:PRHL) are both utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Risk & Volatility

CenterPoint Energy has a beta of 0.53, indicating that its stock price is 47% less volatile than the S&P 500. Comparatively, Premier has a beta of 0.29, indicating that its stock price is 71% less volatile than the S&P 500.

Profitability

This table compares CenterPoint Energy and Premier’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CenterPoint Energy 17.59% 16.22% 3.04%
Premier -255.86% -164.85% -98.60%

Dividends

CenterPoint Energy pays an annual dividend of $1.11 per share and has a dividend yield of 4.0%. Premier does not pay a dividend. CenterPoint Energy pays out 81.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CenterPoint Energy has increased its dividend for 12 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings for CenterPoint Energy and Premier, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CenterPoint Energy 0 6 2 0 2.25
Premier 0 0 0 0 N/A

CenterPoint Energy presently has a consensus price target of $27.86, suggesting a potential upside of 1.08%. Given CenterPoint Energy’s higher probable upside, research analysts clearly believe CenterPoint Energy is more favorable than Premier.

Institutional and Insider Ownership

79.0% of CenterPoint Energy shares are held by institutional investors. 0.2% of CenterPoint Energy shares are held by insiders. Comparatively, 39.3% of Premier shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares CenterPoint Energy and Premier’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CenterPoint Energy $9.61 billion 1.24 $1.79 billion $1.37 20.12
Premier $4.79 million 2.31 -$5.59 million N/A N/A

CenterPoint Energy has higher revenue and earnings than Premier.

Summary

CenterPoint Energy beats Premier on 11 of the 14 factors compared between the two stocks.

CenterPoint Energy Company Profile

CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The company's Electric Transmission & Distribution segment offers electric transmission and distribution services to retail electric providers, municipalities, electric cooperatives, and other distribution companies. As of December 31, 2017, this segment owned 28,883 pole miles of overhead distribution lines and 24,662 circuit miles of underground distribution lines; and 235 substations with a transformer capacity of 64,924 megavolt amperes, as well as operated 14 regional service centers. Its Natural Gas Distribution segment sells regulated intrastate natural gas; provides natural gas transportation and storage services for residential, commercial, industrial, and transportation customers; and offers unregulated services comprising residential appliance repair and maintenance services. As of December 31, 2017, this segment owned approximately 75,000 linear miles of natural gas distribution mains. The company's Energy Services segment provides physical natural gas supplies primarily to commercial and industrial customers, and electric and natural gas utilities; natural gas management services; and physical delivery services, as well as procures and optimizes transportation and storage assets. This segment owns and operates approximately 200 miles of intrastate pipelines; and leases transportation capacity on various interstate and intrastate pipelines, and storage. Its Midstream Investments segment offers natural gas and crude oil gathering, and natural gas processing services to its producer customers; and interstate and intrastate natural gas pipeline transportation and storage services to its producer, power plant, local distribution company, and industrial end-user customers. The company was founded in 1882 and is based in Houston, Texas.

Premier Company Profile

Premier Holding Corporation, through its subsidiaries, provides energy efficiency products and services primarily to commercial middle market companies and residential customers in the United States. The company offers various electricity plans and upgrades to a facility's energy infrastructure. It also offers deregulated power brokerage services. The company was formerly known as OVM International Holding Corporation and changed its name to Premier Holding Corporation in November 2008. Premier Holding Corporation was founded in 1971 and is based in Tustin, California.

Receive News & Ratings for CenterPoint Energy Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for CenterPoint Energy and related companies with MarketBeat.com's FREE daily email newsletter.


Leave a Reply