Pennon Group (OTCMKTS:PEGRF) & Middlesex Water (NASDAQ:MSEX) Head-To-Head Review

Pennon Group (OTCMKTS:PEGRF) and Middlesex Water (NASDAQ:MSEX) are both utilities companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.

Dividends

Pennon Group pays an annual dividend of $0.30 per share and has a dividend yield of 4.9%. Middlesex Water pays an annual dividend of $1.44 per share and has a dividend yield of 2.5%. Pennon Group pays out 104.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Middlesex Water pays out 55.6% of its earnings in the form of a dividend. Middlesex Water has increased its dividend for 52 consecutive years.

Insider and Institutional Ownership

44.0% of Pennon Group shares are held by institutional investors. Comparatively, 79.5% of Middlesex Water shares are held by institutional investors. 1.9% of Middlesex Water shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Pennon Group and Middlesex Water’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pennon Group	N/A	N/A	N/A
Middlesex Water	23.26%	9.59%	3.48%

Valuation and Earnings

This table compares Pennon Group and Middlesex Water”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pennon Group	N/A	N/A	N/A	$0.29	21.47
Middlesex Water	$194.69 million	5.64	$42.82 million	$2.59	22.49

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Pennon Group and Middlesex Water, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pennon Group	0	1	4	0	2.80
Middlesex Water	0	1	1	0	2.50

Middlesex Water has a consensus price target of $61.67, indicating a potential upside of 5.85%. Given Middlesex Water’s higher possible upside, analysts plainly believe Middlesex Water is more favorable than Pennon Group.

Summary

Middlesex Water beats Pennon Group on 11 of the 14 factors compared between the two stocks.

About Pennon Group

Pennon Group Plc provides clean water and wastewater services in the United Kingdom. It provides water and wastewater services for customers in Cornwall, Devon, and parts of Dorset and Somerset; water-only services in the areas of Dorset, Hampshire, and Wiltshire; and water and wastewater retail services to non-household customers in Great Britain. The company also offers regulated water to approximately 1.2 million customers in the Bristol region. Pennon Group Plc was incorporated in 1989 and is based in Exeter, the United Kingdom.

About Middlesex Water

Middlesex Water Company owns and operates regulated water utility and wastewater systems. It operates in Regulated and Non-Regulated segments. The Regulated segment collects, treats, and distributes water on a retail and wholesale basis to residential, commercial, industrial, and fire protection customers, as well as provides regulated wastewater systems in New Jersey and Delaware. The Non-Regulated segment provides non-regulated contract services for the operation and maintenance of municipal and private water and wastewater systems in New Jersey and Delaware. Middlesex Water Company was incorporated in 1896 and is headquartered in Iselin, New Jersey.