Analyzing Avangrid (AGR) and Brookfield Renewable Partners (BEP)

Avangrid (NYSE: AGR) and Brookfield Renewable Partners (NYSE:BEP) are both utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, valuation, profitability and institutional ownership.

Dividends

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Avangrid pays an annual dividend of $1.73 per share and has a dividend yield of 3.4%. Brookfield Renewable Partners pays an annual dividend of $1.96 per share and has a dividend yield of 6.5%. Avangrid pays out 78.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brookfield Renewable Partners pays out -852.2% of its earnings in the form of a dividend. Brookfield Renewable Partners has increased its dividend for 4 consecutive years. Brookfield Renewable Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Avangrid and Brookfield Renewable Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Avangrid 6.39% 4.48% 2.16%
Brookfield Renewable Partners 1.85% 0.40% 0.18%

Risk & Volatility

Avangrid has a beta of 0.18, indicating that its share price is 82% less volatile than the S&P 500. Comparatively, Brookfield Renewable Partners has a beta of 0.2, indicating that its share price is 80% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Avangrid and Brookfield Renewable Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Avangrid 1 1 5 0 2.57
Brookfield Renewable Partners 0 9 5 0 2.36

Avangrid currently has a consensus target price of $50.50, indicating a potential downside of 0.92%. Brookfield Renewable Partners has a consensus target price of $36.28, indicating a potential upside of 19.85%. Given Brookfield Renewable Partners’ higher possible upside, analysts plainly believe Brookfield Renewable Partners is more favorable than Avangrid.

Valuation & Earnings

This table compares Avangrid and Brookfield Renewable Partners’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Avangrid $5.96 billion 2.64 $381.00 million $2.20 23.17
Brookfield Renewable Partners $2.67 billion 2.04 -$4.00 million ($0.23) -131.61

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

Institutional & Insider Ownership

14.3% of Avangrid shares are held by institutional investors. Comparatively, 54.0% of Brookfield Renewable Partners shares are held by institutional investors. 0.3% of Avangrid shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Avangrid beats Brookfield Renewable Partners on 10 of the 16 factors compared between the two stocks.

Avangrid Company Profile

Avangrid, Inc. is an energy and utility company. The Company operates through three segments: Networks, Renewables and Gas. The Networks segment includes all the energy transmission and distribution activities, and any other regulated activity originating in New York and Maine, and regulated electric distribution, electric transmission and gas distribution activities originating in Connecticut and Massachusetts. The Renewables segment owns, develops, constructs and/or operates electricity generation, including renewable and thermal generators, and associated transmission facilities. The Renewables segment includes activities relating to renewable energy, mainly wind energy generation and trading related with such activities. The Gas segment operates a natural gas storage and natural gas trading business through its subsidiaries, Enstor, Inc. and Enstor Energy Services, LLC.

Brookfield Renewable Partners Company Profile

Brookfield Renewable Partners L.P. owns a portfolio of renewable power generating facilities in the North America, Colombia, Brazil, Europe, and internationally. The company operates through Hydroelectric; Wind; and Solar, Storage, and others segments. It operates 840 generation facilities using hydro, solar, wind, biomass, and other renewable technologies. Brookfield Renewable Partners Limited operates as the general partner of Brookfield Renewable Partners L.P. The company was formerly known as Brookfield Renewable Energy Partners L.P. and changed its name to Brookfield Renewable Partners L.P. in May 2016. The company was founded in 1999 and is based in Hamilton, Bermuda. Brookfield Renewable Partners L.P. is a subsidiary of Brookfield Renewable Partners Limited.

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