WEC Energy Group (NYSE: WEC) and NiSource (NYSE:NI) are both utilities companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, institutional ownership, profitability, valuation, analyst recommendations, risk and earnings.
WEC Energy Group pays an annual dividend of $2.21 per share and has a dividend yield of 3.4%. NiSource pays an annual dividend of $0.78 per share and has a dividend yield of 3.0%. WEC Energy Group pays out 70.4% of its earnings in the form of a dividend. NiSource pays out 64.5% 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. WEC Energy Group has increased its dividend for 7 consecutive years. WEC Energy Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk and Volatility
WEC Energy Group has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500. Comparatively, NiSource has a beta of 0.28, indicating that its share price is 72% less volatile than the S&P 500.
Valuation and Earnings
This table compares WEC Energy Group and NiSource’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|WEC Energy Group||$7.65 billion||2.67||$1.20 billion||$3.14||20.59|
|NiSource||$4.87 billion||1.82||$128.50 million||$1.21||21.72|
WEC Energy Group has higher revenue and earnings than NiSource. WEC Energy Group is trading at a lower price-to-earnings ratio than NiSource, indicating that it is currently the more affordable of the two stocks.
This table compares WEC Energy Group and NiSource’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|WEC Energy Group||16.23%||11.01%||3.30%|
This is a summary of recent recommendations and price targets for WEC Energy Group and NiSource, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|WEC Energy Group||0||5||2||0||2.29|
WEC Energy Group presently has a consensus price target of $66.83, indicating a potential upside of 3.38%. NiSource has a consensus price target of $26.44, indicating a potential upside of 0.63%. Given WEC Energy Group’s higher probable upside, equities analysts plainly believe WEC Energy Group is more favorable than NiSource.
Institutional and Insider Ownership
73.0% of WEC Energy Group shares are owned by institutional investors. Comparatively, 89.2% of NiSource shares are owned by institutional investors. 1.0% of WEC Energy Group shares are owned by company insiders. Comparatively, 0.4% of NiSource shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
WEC Energy Group beats NiSource on 12 of the 17 factors compared between the two stocks.
WEC Energy Group Company Profile
WEC Energy Group, Inc., through its subsidiaries, provides regulated natural gas and electricity, and nonregulated renewable energy services in the United States. The company operates through six segments: Wisconsin, Illinois, Other States, Electric Transmission, Non-Utility Energy Infrastructure, and Corporate and Other. It generates and distributes electricity from coal, natural gas, oil, hydroelectric, wind, and biomass sources; provides electricity transmission services; offers retail natural gas distribution services; transports customer-owned natural gas; and generates, distributes, and sells steam. The company offers electricity to approximately 1.6 million residential, small and large commercial and industrial, and other customers; and natural gas to 2.8 million residential, and commercial and industrial customers. As of December 31, 2017, it operated approximately 37,100 miles of overhead distribution lines and 32,500 miles of underground distribution cable, as well as approximately 500 distribution substations and 495,500 line transformers; and approximately 47,900 miles of natural gas distribution mains, as well as 1,200 miles of natural gas transmission mains. In addition, WEC Energy Group, Inc. invests in and develops real estate properties, including business parks and other commercial real estate projects primarily in southeastern Wisconsin. The company was formerly known as Wisconsin Energy Corporation and changed its name to WEC Energy Group, Inc. in June 2015. WEC Energy Group, Inc. was founded in 1981 and is headquartered in Milwaukee, Wisconsin.
NiSource Company Profile
NiSource Inc., an energy holding company, operates as a regulated natural gas and electric utility company in the United States. The company operates in two segments, Gas Distribution Operations and Electric Operations. It provides natural gas service and transportation to residential, commercial, and industrial customers; generates, transmits, and distributes electricity; and offers wholesale and transmission transaction services. The company serves approximately 3.5 million natural gas customers and 469,000 electricity customers in Ohio, Pennsylvania, Virginia, Kentucky, Maryland, Indiana, and Massachusetts. It also owns and operates three coal-fired electric generating stations with a net capability of 2,540 megawatts (MW), three gas-fired generating units with a net capability of 196 MW, and two hydroelectric generating plants with a net capability of 10 MW, as well as a combined cycle gas turbine plant with a net capability of 535 MW. The company was formerly known as NIPSCO Industries, Inc. and changed its name to NiSource Inc. in April 1999. NiSource Inc. was founded in 1912 and is headquartered in Merrillville, Indiana.
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