Financial Contrast: Tenaga Nasional Berhad (OTCMKTS:TNABY) and MGE Energy (NASDAQ:MGEE)

MGE Energy (NASDAQ:MGEE) and Tenaga Nasional Berhad (OTCMKTS:TNABY) are both utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.

Insider & Institutional Ownership

52.6% of MGE Energy shares are owned by institutional investors. 0.2% of MGE Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings for MGE Energy and Tenaga Nasional Berhad, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MGE Energy	1	2	0	0	1.67
Tenaga Nasional Berhad	0	0	0	0	0.00

MGE Energy currently has a consensus price target of $78.00, suggesting a potential upside of 1.43%. Given MGE Energy’s stronger consensus rating and higher probable upside, research analysts plainly believe MGE Energy is more favorable than Tenaga Nasional Berhad.

Dividends

MGE Energy pays an annual dividend of $1.90 per share and has a dividend yield of 2.5%. Tenaga Nasional Berhad pays an annual dividend of $0.38 per share and has a dividend yield of 2.8%. MGE Energy pays out 51.1% of its earnings in the form of a dividend. Tenaga Nasional Berhad pays out 86.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MGE Energy has raised its dividend for 49 consecutive years.

Earnings & Valuation

This table compares MGE Energy and Tenaga Nasional Berhad”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MGE Energy	$743.65 million	3.78	$135.89 million	$3.72	20.67
Tenaga Nasional Berhad	N/A	N/A	N/A	$0.44	31.32

MGE Energy has higher revenue and earnings than Tenaga Nasional Berhad. MGE Energy is trading at a lower price-to-earnings ratio than Tenaga Nasional Berhad, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares MGE Energy and Tenaga Nasional Berhad’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MGE Energy	18.27%	10.60%	4.59%
Tenaga Nasional Berhad	N/A	N/A	N/A

Risk & Volatility

MGE Energy has a beta of 0.81, suggesting that its share price is 19% less volatile than the S&P 500. Comparatively, Tenaga Nasional Berhad has a beta of -0.44, suggesting that its share price is 144% less volatile than the S&P 500.

Summary

MGE Energy beats Tenaga Nasional Berhad on 12 of the 14 factors compared between the two stocks.

About MGE Energy

MGE Energy, Inc., through its subsidiaries, operates as a public utility holding company primarily in the United States. It operates through Regulated Electric Utility Operations; Regulated Gas Utility Operations; Nonregulated Energy Operations; Transmission Investments; and All Other segments. The company generates, purchases, and distributes electricity and natural gas in Wisconsin and Iowa; owns and leases electric generating capacity; and plans, constructs, operates, maintains, and expands transmission facilities to provide transmission power services. It generates electricity from coal-fired, gas-fired, and renewable energy sources. As of December 31, 2023, the company owned and operated 835 miles of overhead electric distribution lines; 1,330 miles of underground electric distribution cables; 49 substations with an installed capacity of 1.2 million kVA; and gas facilities, including 3,066 miles of distribution mains, as well as supplied electric service to approximately 163,000 customers. MGE Energy, Inc. founded in 2001 and is headquartered in Madison, Wisconsin.

About Tenaga Nasional Berhad

Tenaga Nasional Berhad engages in the generation, transmission, distribution, and sale of electricity in Malaysia and internationally. The company operates and maintains thermal generation facilities and hydroelectric power generating schemes; and manages and operates the National Grid that is connected to Thailand's transmission system, as well as Singapore's transmission system at Senoko. It also supplies fuel and coal for power generation; generates, distributes, supplies, deals in, and sells various energy sources, as well as provides related technical services; develops district cooling systems; operates and maintains co-generation works; manufactures, sells, and repairs distribution, power, and earthing transformers; and develops, owns, and manages dry bulk terminals. In addition, the company provides turnkey contracting of transmission substations; repair and maintenance services to heavy industries and other related services; operation and maintenance services on telecommunication equipment and data centres; higher education, and telecommunication and IT infrastructure solution and services; research and development services in the areas of engineering, information technology, business, accountancy, and liberal studies; and training courses. Further, it offers insurance and reinsurance products, technical and laboratory, consultancy, and other services; manufactures and distributes power and general cables, and aluminum rods; operates an integrated district cooling systems for air conditioning systems of office buildings; assembles, manufactures, tests, reconditions, and distributes high and medium voltage switchgears, and control gears for transmission and distribution of electric power; and operates wind assets. It primarily serves commercial, industrial, and residential customers. The company was founded in 1949 and is headquartered in Kuala Lumpur, Malaysia.