CenterPoint Energy (NYSE:CNP – Get Free Report) and Public Service Enterprise Group (NYSE:PEG – Get Free Report) are both large-cap utilities companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.
Profitability
This table compares CenterPoint Energy and Public Service Enterprise Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| CenterPoint Energy | 11.38% | 10.56% | 2.57% |
| Public Service Enterprise Group | 17.69% | 12.30% | 3.66% |
Analyst Recommendations
This is a summary of current ratings and price targets for CenterPoint Energy and Public Service Enterprise Group, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| CenterPoint Energy | 1 | 6 | 8 | 0 | 2.47 |
| Public Service Enterprise Group | 0 | 7 | 7 | 1 | 2.60 |
Earnings and Valuation
This table compares CenterPoint Energy and Public Service Enterprise Group”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| CenterPoint Energy | $9.41 billion | 2.98 | $1.05 billion | $1.63 | 26.29 |
| Public Service Enterprise Group | $12.17 billion | 3.26 | $2.11 billion | $4.52 | 17.62 |
Public Service Enterprise Group has higher revenue and earnings than CenterPoint Energy. Public Service Enterprise Group is trading at a lower price-to-earnings ratio than CenterPoint Energy, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
CenterPoint Energy has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Public Service Enterprise Group has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500.
Dividends
CenterPoint Energy pays an annual dividend of $0.92 per share and has a dividend yield of 2.1%. Public Service Enterprise Group pays an annual dividend of $2.68 per share and has a dividend yield of 3.4%. CenterPoint Energy pays out 56.4% of its earnings in the form of a dividend. Public Service Enterprise Group pays out 59.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. CenterPoint Energy has increased its dividend for 5 consecutive years and Public Service Enterprise Group has increased its dividend for 14 consecutive years. Public Service Enterprise Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
91.8% of CenterPoint Energy shares are held by institutional investors. Comparatively, 73.3% of Public Service Enterprise Group shares are held by institutional investors. 0.2% of CenterPoint Energy shares are held by insiders. Comparatively, 0.2% of Public Service Enterprise Group shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary
Public Service Enterprise Group beats CenterPoint Energy on 13 of the 17 factors compared between the two stocks.
About CenterPoint Energy
CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The company operates through two segments, Electric and Natural Gas. The Electric segment includes electric transmission and distribution services to electric customers and electric generation assets, as well as optimizes assets in the wholesale power market. The Natural Gas segment engages in the intrastate natural gas sales, and natural gas transportation and distribution for residential, commercial, industrial and institutional customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas; permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies; and provides maintenance and repair services of home appliances to customers in Minnesota and home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio, and Texas through a third party. It serves approximately 2,534,730 metered customers; owned 348 substations with transformer capacity of 79,719 megavolt amperes; and owned and operated 217 miles of intrastate pipeline in Louisiana and Texas. The company was founded in 1866 and is headquartered in Houston, Texas.
About Public Service Enterprise Group
Public Service Enterprise Group Incorporated, through its subsidiaries, operates in electric and gas utility business in the United States. It operates through PSE&G and PSEG Power segments. The PSE&G segment transmits electricity; distributes electricity and natural gas to residential, commercial, and industrial customers; and appliance services and repairs to customers through its service territory, as well as invests in solar generation projects, and energy efficiency and related programs. The PSEG Power segment engages in nuclear generation businesses; and supplies power and natural gas to nuclear power plants and gas storage facilities activities. As of December 31, 2023, it had electric transmission and distribution system of 25,000 circuit miles and 866,600 poles; 56 switching stations with an installed capacity of 39,953 megavolt-amperes (MVA), and 235 substations with an installed capacity of 10,382 MVA; 109 MVA aggregate installed capacity for substations; four electric distribution headquarters and five electric sub-headquarters; 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 56 natural gas metering and regulating stations; and 158 MegaWatts defined conditions of installed PV solar capacity. Public Service Enterprise Group Incorporated was founded in 1903 and is based in Newark, New Jersey.
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