Critical Analysis: Evergy (NYSE:EVRG) & Alliant Energy (NYSE:LNT)

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Evergy (NYSE:EVRG) and Alliant Energy (NYSE:LNT) are both large-cap oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Evergy and Alliant Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Evergy 2 2 2 0 2.00
Alliant Energy 0 2 4 0 2.67

Evergy currently has a consensus price target of $65.33, suggesting a potential upside of 4.10%. Alliant Energy has a consensus price target of $53.80, suggesting a potential upside of 1.65%. Given Evergy’s higher probable upside, research analysts plainly believe Evergy is more favorable than Alliant Energy.

Volatility & Risk

Evergy has a beta of 0.12, suggesting that its stock price is 88% less volatile than the S&P 500. Comparatively, Alliant Energy has a beta of 0.18, suggesting that its stock price is 82% less volatile than the S&P 500.

Profitability

This table compares Evergy and Alliant Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Evergy 11.97% 6.96% 2.48%
Alliant Energy 15.09% 11.69% 3.48%

Institutional and Insider Ownership

86.4% of Evergy shares are owned by institutional investors. Comparatively, 71.1% of Alliant Energy shares are owned by institutional investors. 0.4% of Evergy shares are owned by insiders. Comparatively, 0.3% of Alliant Energy shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Evergy pays an annual dividend of $2.02 per share and has a dividend yield of 3.2%. Alliant Energy pays an annual dividend of $1.42 per share and has a dividend yield of 2.7%. Evergy pays out 75.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alliant Energy pays out 73.6% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Evergy and Alliant Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Evergy $4.28 billion 3.35 $535.80 million $2.67 23.51
Alliant Energy $3.38 billion 3.76 $467.50 million $1.93 27.42

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

Summary

Alliant Energy beats Evergy on 9 of the 16 factors compared between the two stocks.

Evergy Company Profile

Westar Energy, Inc. engages in the generation, transmission and distribution of electricity in Kansas. It provides electricity to residential, commercial, and industrial customers in the cities of Topeka, Lawrence, Manhattan, Salina, and Hutchinson. The company was founded in 1924 and is headquartered in Topeka, KS.

Alliant Energy Company Profile

Alliant Energy Corporation operates as a utility holding company that provides regulated electricity and natural gas services in the Midwest region of the United States. It operates through three segments: Electric, Gas, and Other. The company, through its subsidiary, Interstate Power and Light Company (IPL), primarily generates and distributes electricity, and distributes and transports natural gas to retail customers in Iowa; sells electricity to wholesale customers in Minnesota, Illinois, and Iowa; and generates and distributes steam in Cedar Rapids, Iowa. Alliant Energy Corporation, through its subsidiary, Wisconsin Power and Light Company (WPL), generates and distributes electricity, and distributes and transports natural gas to retail customers in Wisconsin; and sells electricity to wholesale customers in Wisconsin. As of December 31, 2017, IPL supplied electricity to 490,000 retail customers and natural gas to 220,000 retail customers; and WPL supplied electricity to 470,000 retail customers and natural gas to 190,000 retail customers. It offers electric utility services to retail customers in the farming, agriculture, industrial manufacturing, chemical, and paper industries. In addition, the company holds investments in various businesses, which provide freight services through a short-line railway between Cedar Rapids and Iowa City, Iowa; a barge terminal and hauling services on the Mississippi River; and other transfer and storage services. Further, it owns a non-regulated 347 megawatt (MW) natural gas-fired electric generating unit near Sheboygan Falls, Wisconsin; and a non-regulated 99 MW Franklin County wind farm located in Franklin County, Iowa. Alliant Energy Corporation was founded in 1917 and is headquartered in Madison, Wisconsin.

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