Northwest Natural Gas Company (NYSE: NWN) and Spire (NYSE:SR) are both utilities companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitabiliy, risk, earnings, analyst recommendations, dividends and valuation.

Valuation & Earnings

This table compares Northwest Natural Gas Company and Spire’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Northwest Natural Gas Company $717.76 million 2.41 $255.20 million $2.18 27.68
Spire $1.69 billion 1.98 $442.80 million $3.28 21.17

Spire has higher revenue and earnings than Northwest Natural Gas Company. Spire is trading at a lower price-to-earnings ratio than Northwest Natural Gas Company, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Northwest Natural Gas Company and Spire’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Northwest Natural Gas Company 8.72% 7.57% 2.08%
Spire 8.87% 8.66% 2.62%

Insider & Institutional Ownership

63.7% of Northwest Natural Gas Company shares are owned by institutional investors. Comparatively, 74.3% of Spire shares are owned by institutional investors. 1.5% of Northwest Natural Gas Company shares are owned by company insiders. Comparatively, 3.1% of Spire shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Northwest Natural Gas Company pays an annual dividend of $1.88 per share and has a dividend yield of 3.1%. Spire pays an annual dividend of $2.10 per share and has a dividend yield of 3.0%. Northwest Natural Gas Company pays out 86.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Spire pays out 64.0% of its earnings in the form of a dividend. Northwest Natural Gas Company has increased its dividend for 61 consecutive years. Northwest Natural Gas Company is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Northwest Natural Gas Company has a beta of 0.42, indicating that its share price is 58% less volatile than the S&P 500. Comparatively, Spire has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Northwest Natural Gas Company and Spire, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Northwest Natural Gas Company 0 2 1 0 2.33
Spire 1 3 1 0 2.00

Northwest Natural Gas Company currently has a consensus target price of $75.00, suggesting a potential upside of 24.28%. Spire has a consensus target price of $69.25, suggesting a potential downside of 0.29%. Given Northwest Natural Gas Company’s stronger consensus rating and higher possible upside, research analysts plainly believe Northwest Natural Gas Company is more favorable than Spire.

Summary

Spire beats Northwest Natural Gas Company on 9 of the 16 factors compared between the two stocks.

Northwest Natural Gas Company Company Profile

Northwest Natural Gas Company (NW Natural) is engaged in the distribution of natural gas. The Company’s segments include Local Gas Distribution, Gas Storage and other. The Company maintains operations in Oregon, Washington and California and conducts businesses through NW Natural and its subsidiaries. The local gas distribution business, referred to as the utility segment, serves residential, commercial, and industrial customers in Oregon and southwest Washington. The Company’s gas storage business, referred to as the gas storage segment, provides storage services for utilities, gas marketers, electric generators and industrial users from storage facilities located in Oregon and California. The Company’s other segment is referred to as non-utility and consists of non-utility investments and other business activities. The other segment consists of an equity method investment in Trail West Holdings, LLC (TWH) and other pipeline assets in NNG Financial Corporation.

Spire Company Profile

Spire Inc., formerly The Laclede Group, Inc., is engaged to transform its business and pursue growth by growing its gas utility business through prudent investment in infrastructure upgrades and organic growth initiatives; acquire and integrate gas utilities; modernize its gas assets, and invest in innovation. The Company has two business segments, which include gas utility and gas marketing. The gas utility segment includes the regulated operations of Laclede Gas Company (Laclede Gas), Alabama Gas Corporation (Alagasco) and EnergySouth, Inc. (EnergySouth). The gas marketing segment includes Laclede Energy Resources, Inc. (LER), a subsidiary engaged in the marketing of natural gas and related activities on a non-regulated basis. Laclede Gas is engaged in the purchase, retail distribution and sale of natural gas, serving residential, commercial and industrial customers, through Missouri Gas Energy (MGE), Kansas City and western Missouri.

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