Critical Survey: Exelon (EXC) vs. SCANA (SCG)

Exelon (NYSE: EXC) and SCANA (NYSE:SCG) are both mid-cap utilities companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Exelon has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500. Comparatively, SCANA has a beta of 0.2, suggesting that its stock price is 80% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Exelon and SCANA, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Exelon 2 3 11 0 2.56
SCANA 2 7 2 0 2.00

Exelon presently has a consensus target price of $40.75, indicating a potential upside of 5.93%. SCANA has a consensus target price of $56.69, indicating a potential upside of 33.98%. Given SCANA’s higher possible upside, analysts clearly believe SCANA is more favorable than Exelon.

Valuation and Earnings

This table compares Exelon and SCANA’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Exelon $31.36 billion 1.18 $1.13 billion $2.23 17.25
SCANA $4.23 billion 1.43 $595.00 million $3.16 13.39

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

Institutional and Insider Ownership

77.3% of Exelon shares are held by institutional investors. Comparatively, 66.5% of SCANA shares are held by institutional investors. 0.7% of Exelon shares are held by insiders. Comparatively, 0.4% of SCANA shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Exelon and SCANA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Exelon 6.59% 8.19% 2.02%
SCANA 10.45% 10.05% 3.05%

Dividends

Exelon pays an annual dividend of $1.31 per share and has a dividend yield of 3.4%. SCANA pays an annual dividend of $2.45 per share and has a dividend yield of 5.8%. Exelon pays out 58.7% of its earnings in the form of a dividend. SCANA pays out 77.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Exelon has raised its dividend for 2 consecutive years and SCANA has raised its dividend for 18 consecutive years. SCANA is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Exelon beats SCANA on 9 of the 17 factors compared between the two stocks.

Exelon Company Profile

Exelon Corporation is a utility services holding company. The Company, through its subsidiary, Exelon Generation Company, LLC (Generation), is engaged in the energy generation business. The Company, through its subsidiaries, Commonwealth Edison Company (ComEd), PECO Energy Company (PECO), Baltimore Gas and Electric Company (BGE), Pepco Holdings LLC (PHI), Potomac Electric Power Company (Pepco), Delmarva Power & Light Company (DPL) and Atlantic City Electric Company (ACE), is engaged in the energy delivery businesses. It operates through 12 segments: Generation’s six segments: Mid-Atlantic, Midwest, New England, New York, ERCOT and Other Power Regions; ComEd; PECO; BGE, and PHI’s three utility segments: Pepco, DPL and ACE. Generation’s integrated business consists of the generation, physical delivery and marketing of power across geographical regions through its customer-facing business, Constellation, which sells electricity and natural gas to both wholesale and retail customers.

SCANA Company Profile

SCANA Corporation is a holding company. The Company, through its subsidiaries, is engaged in the generation, transmission, distribution and sale of electricity in South Carolina. The Company operates through segments, including Electric Operations, Gas Distribution, Gas Marketing and All Other. The Company is engaged in the purchase, transmission and sale of natural gas in North Carolina and South Carolina. The Electric Operations segment generates, transmits and distributes electricity. The Company’s regulated businesses include subsidiaries, such as South Carolina Electric & Gas Company (SCE&G), South Carolina Fuel Company, Inc. (Fuel Company), South Carolina Generating Company, Inc. (GENCO) and Public Service Company of North Carolina, Incorporated (PSNC Energy). The Company’s nonregulated businesses include subsidiaries, such as SCANA Energy Marketing, Inc. (SCANA Energy), ServiceCare, Inc., SCANA Services, Inc. and SCANA Corporate Security Services, Inc.

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