DTE Energy (NYSE: DTE) and MGE Energy (NASDAQ:MGEE) are both utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, earnings, risk, valuation and dividends.
Risk & Volatility
DTE Energy has a beta of 0.14, indicating that its stock price is 86% less volatile than the S&P 500. Comparatively, MGE Energy has a beta of 0.24, indicating that its stock price is 76% less volatile than the S&P 500.
68.3% of DTE Energy shares are held by institutional investors. Comparatively, 38.7% of MGE Energy shares are held by institutional investors. 0.5% of DTE Energy shares are held by company insiders. Comparatively, 0.2% of MGE Energy shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares DTE Energy and MGE Energy’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|DTE Energy||$12.61 billion||1.49||$1.13 billion||$6.33||16.54|
|MGE Energy||$563.10 million||3.43||$97.61 million||$2.82||19.73|
DTE Energy has higher revenue and earnings than MGE Energy. DTE Energy is trading at a lower price-to-earnings ratio than MGE Energy, indicating that it is currently the more affordable of the two stocks.
DTE Energy pays an annual dividend of $3.53 per share and has a dividend yield of 3.4%. MGE Energy pays an annual dividend of $1.29 per share and has a dividend yield of 2.3%. DTE Energy pays out 55.8% of its earnings in the form of a dividend. MGE Energy pays out 45.7% 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. DTE Energy has increased its dividend for 6 consecutive years and MGE Energy has increased its dividend for 42 consecutive years.
This is a summary of current recommendations and price targets for DTE Energy and MGE Energy, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
DTE Energy presently has a consensus target price of $111.44, suggesting a potential upside of 6.44%. Given DTE Energy’s stronger consensus rating and higher probable upside, analysts plainly believe DTE Energy is more favorable than MGE Energy.
This table compares DTE Energy and MGE Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
DTE Energy beats MGE Energy on 10 of the 17 factors compared between the two stocks.
About DTE Energy
DTE Energy Company is an energy company. Its segments include Electric, which consists of DTE Electric Company, which is engaged in the generation, purchase, distribution and sale of electricity to residential, commercial and industrial customers in southeastern Michigan; Gas, which consists of DTE Gas Company, which is engaged in the purchase, storage, transportation, distribution and sale of natural gas to residential, commercial and industrial customers throughout Michigan; Gas Storage and Pipelines, which consists of natural gas pipeline, gathering and storage businesses; Power and Industrial Projects, which consists of projects that deliver energy and utility-type products and services to industrial, commercial and institutional customers, and sell electricity from renewable energy projects; Energy Trading, which consists of energy marketing and trading operations, and Corporate and Other, which includes various holding company activities and holds certain non-utility debt.
About MGE Energy
MGE Energy, Inc. (MGE) is a public utility holding company. The Company operates through five segments: Regulated electric utility operations; Regulated gas utility operations; Nonregulated energy operations; Transmission investments, and All other. The Regulated electric utility operations segment is engaged in generating, purchasing and distributing electricity through Madison Gas and Electric Company (MGE). The Regulated gas utility operations segment is engaged in purchasing and distributing natural gas through MGE. The Nonregulated energy operations segment is engaged in owning and leasing electric generating capacity that assists MGE through MGE Energy’s subsidiaries MGE Power Elm Road, LLC and MGE Power West Campus, LLC. The Transmission investments segment represents its investment in American Transmission Company LLC and ATC Holdco, LLC. The All other segment is engaged in investing and financing in companies and property that relate to the regulated operations.
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