Financial Comparison: Dynegy (DYN) and The AES Corporation (AES)
The AES Corporation (NYSE: AES) and Dynegy (NYSE:DYN) are both utilities companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, profitabiliy, earnings, institutional ownership and risk.
This is a summary of current ratings and recommmendations for The AES Corporation and Dynegy, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The AES Corporation||1||3||0||0||1.75|
The AES Corporation presently has a consensus price target of $12.00, indicating a potential upside of 5.91%. Dynegy has a consensus price target of $12.83, indicating a potential upside of 52.60%. Given Dynegy’s stronger consensus rating and higher probable upside, analysts clearly believe Dynegy is more favorable than The AES Corporation.
The AES Corporation pays an annual dividend of $0.48 per share and has a dividend yield of 4.2%. Dynegy does not pay a dividend. The AES Corporation pays out -24.6% of its earnings in the form of a dividend. Dynegy has increased its dividend for 4 consecutive years.
Insider & Institutional Ownership
94.3% of The AES Corporation shares are owned by institutional investors. 1.1% of The AES Corporation shares are owned by company insiders. Comparatively, 1.8% of Dynegy 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.
Valuation and Earnings
This table compares The AES Corporation and Dynegy’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|The AES Corporation||$13.81 billion||0.54||$3.49 billion||($1.95)||-5.81|
|Dynegy||$4.44 billion||0.25||$833.00 million||($6.21)||-1.35|
The AES Corporation has higher revenue and earnings than Dynegy. The AES Corporation is trading at a lower price-to-earnings ratio than Dynegy, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
The AES Corporation has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500. Comparatively, Dynegy has a beta of 1.85, meaning that its share price is 85% more volatile than the S&P 500.
This table compares The AES Corporation and Dynegy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The AES Corporation||-9.27%||14.71%||2.33%|
The AES Corporation beats Dynegy on 10 of the 16 factors compared between the two stocks.
The AES Corporation Company Profile
The AES Corporation is a holding company. The Company, through its subsidiaries and affiliates, operates a diversified portfolio of electricity generation and distribution businesses. It is organized into six strategic business units (SBUs): the United States; Andes; Brazil; Mexico, Central America and the Caribbean (MCAC); Europe, and Asia. As of December 31, 2016, its United States SBU had 18 generation facilities and two integrated utilities in the United States. As of December 31, 2016, its Andes SBU had generation facilities in three countries. Its Brazil SBU has generation and distribution businesses, Eletropaulo and Tiete. As of December 31, 2016, its MCAC SBU had a portfolio of distribution businesses and generation facilities, including renewable energy, in five countries. As of December 31, 2016, its Europe SBU had generation facilities in five countries. As of December 31, 2016, its Asia SBU had generation facilities in three countries.
Dynegy Company Profile
Dynegy Inc. (Dynegy) is a holding company and conducts the business operations through its subsidiaries. The primary business of Dynegy is the production and sale of electric energy, capacity and ancillary services from the fleet of 18 operating power plants in six states totaling approximately 12,300 megawatt (MW) of generating capacity. Dynegy sells electric energy, capacity and ancillary services on a wholesale basis from its power generation facilities. Its customers include Regional Transmission Organization (RTOs) and Independent System Operators (ISOs), integrated utilities, municipalities, electric cooperatives, transmission and distribution utilities, industrial customers, power marketers, financial participants, such as banks and hedge funds, other power generators and commercial end-users. It has three segments: Midwest segment (GEN-MW), West segment (GEN-WE) and Northeast segment (GEN-NE). Its wholly owned subsidiary is Dynegy Holdings Inc. (DHI).
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