TransAlta Corporation (NYSE: TAC) and Comp En De Mn Cemig ADS (NYSE:CIG) are both utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for TransAlta Corporation and Comp En De Mn Cemig ADS, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TransAlta Corporation 0 4 0 0 2.00
Comp En De Mn Cemig ADS 0 2 1 0 2.33

TransAlta Corporation presently has a consensus target price of $7.00, indicating a potential upside of 12.90%. Comp En De Mn Cemig ADS has a consensus target price of $2.80, indicating a potential upside of 7.69%. Given TransAlta Corporation’s higher probable upside, equities research analysts clearly believe TransAlta Corporation is more favorable than Comp En De Mn Cemig ADS.

Dividends

TransAlta Corporation pays an annual dividend of $0.12 per share and has a dividend yield of 1.9%. Comp En De Mn Cemig ADS pays an annual dividend of $0.13 per share and has a dividend yield of 5.0%. TransAlta Corporation pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation and Earnings

This table compares TransAlta Corporation and Comp En De Mn Cemig ADS’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
TransAlta Corporation $1.92 billion 0.93 $721.24 million $0.09 68.90
Comp En De Mn Cemig ADS $6.12 billion 0.53 $1.31 billion N/A N/A

Comp En De Mn Cemig ADS has higher revenue and earnings than TransAlta Corporation.

Institutional & Insider Ownership

50.9% of TransAlta Corporation shares are held by institutional investors. Comparatively, 3.2% of Comp En De Mn Cemig ADS shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares TransAlta Corporation and Comp En De Mn Cemig ADS’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TransAlta Corporation 1.67% 1.00% 0.34%
Comp En De Mn Cemig ADS N/A N/A N/A

Volatility and Risk

TransAlta Corporation has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500. Comparatively, Comp En De Mn Cemig ADS has a beta of 1.89, meaning that its stock price is 89% more volatile than the S&P 500.

Summary

Comp En De Mn Cemig ADS beats TransAlta Corporation on 7 of the 13 factors compared between the two stocks.

TransAlta Corporation Company Profile

TransAlta Corporation (TransAlta) is a non-regulated electricity generation and energy marketing company with an aggregate net ownership interest of approximately 8,720 megawatts of generating capacity. The Company is engaged in the production and sale of electric energy. It focuses on generating and marketing electricity in Canada, the United States and Western Australia through its diversified portfolio of facilities fuelled by coal, natural gas, diesel, hydro, wind and solar. TransAlta is organized into eight business segments: Canadian Coal, U.S. Coal, Canadian Gas, Australian Gas, Wind and Solar, Hydro, Energy Marketing and Corporate. The Canadian Coal, U.S. Coal, Canadian Gas, Australian Gas, Wind and Solar, and Hydro segments are responsible for constructing, operating and maintaining its electrical generation. All the segments are supported by a Corporate segment, which includes the Corporation’s central financial, legal, administrative, and investing functions.

Comp En De Mn Cemig ADS Company Profile

Companhia Energetica de Minas Gerais-CEMIG is a holding company that is engaged in the generation, transmission and distribution of electricity. The Company’s segments include Generation, Transmission, Distribution, Telecom, Gas and Other. The Company, through its interests in subsidiaries or jointly controlled entities, is engaged in the activities of the construction and operation of systems for sale of electricity, as well as various fields of energy and telecommunications, for the purpose of commercial operation. Its electric power transmission business consists of transporting power from the facilities where it is generated to points of consumption, distribution networks and Free Consumers. Its distribution operation consists of transfers of electricity from distribution substations to final consumers. It is also engaged in businesses, such as telecommunications, energy solutions consulting, and acquisition, transport and distribution of gas and its subproducts and derivatives.

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