WEC Energy Group (WEC) versus Edison International (EIX) Head-To-Head Contrast
WEC Energy Group (NYSE: WEC) and Edison International (NYSE:EIX) are both large-cap utilities companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, dividends, analyst recommendations, earnings, institutional ownership, risk and valuation.
Risk & Volatility
WEC Energy Group has a beta of 0.12, indicating that its stock price is 88% less volatile than the S&P 500. Comparatively, Edison International has a beta of 0.22, indicating that its stock price is 78% less volatile than the S&P 500.
This table compares WEC Energy Group and Edison International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|WEC Energy Group||12.72%||10.75%||3.23%|
WEC Energy Group pays an annual dividend of $2.08 per share and has a dividend yield of 3.2%. Edison International pays an annual dividend of $2.17 per share and has a dividend yield of 2.8%. WEC Energy Group pays out 68.4% of its earnings in the form of a dividend. Edison International pays out 50.8% 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 raised its dividend for 6 consecutive years and Edison International has raised its dividend for 12 consecutive years.
This is a summary of current ratings and price targets for WEC Energy Group and Edison International, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|WEC Energy Group||1||5||1||0||2.00|
WEC Energy Group currently has a consensus price target of $62.50, suggesting a potential downside of 3.45%. Edison International has a consensus price target of $85.10, suggesting a potential upside of 8.52%. Given Edison International’s stronger consensus rating and higher probable upside, analysts plainly believe Edison International is more favorable than WEC Energy Group.
Institutional & Insider Ownership
70.2% of WEC Energy Group shares are held by institutional investors. Comparatively, 81.5% of Edison International shares are held by institutional investors. 1.0% of WEC Energy Group shares are held by company insiders. Comparatively, 0.4% of Edison International shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares WEC Energy Group and Edison International’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|WEC Energy Group||$7.61 billion||2.68||$2.51 billion||$3.04||21.29|
|Edison International||$12.08 billion||2.12||$4.10 billion||$4.27||18.37|
Edison International has higher revenue and earnings than WEC Energy Group. Edison International is trading at a lower price-to-earnings ratio than WEC Energy Group, indicating that it is currently the more affordable of the two stocks.
Edison International beats WEC Energy Group on 10 of the 17 factors compared between the two stocks.
WEC Energy Group Company Profile
WEC Energy Group, Inc. was a diversified holding company with natural gas and electric utility operations, an approximately 60% equity ownership interest in American Transmission Company LLC, and non-utility electric operations through its We Power business, as of December 31, 2016. Its segments include Wisconsin; Illinois; Other States; Electric Transmission; We Power, and Corporate and Other. Wisconsin includes the electric and natural gas utility operations of Wisconsin Electric Power Company, Wisconsin Gas LLC, and Wisconsin Public Service Corporation, including WE’s and WPS’s electric and natural gas operations in the state of Michigan. Illinois includes the natural gas utility and non-utility operations of The Peoples Gas Light and Coke Company and North Shore Gas Company. Other states includes the natural gas utility and non-utility operations of Minnesota Energy Resources Corporation and Michigan Gas Utilities Corporation.
Edison International Company Profile
Edison International is the holding company of Southern California Edison Company (SCE). As of December 31, 2016, SCE, a public utility, was primarily engaged in the business of supplying and delivering electricity to an approximately 50,000 square mile area of southern California. The Company is also the parent company of Edison Energy Group, Inc. (Edison Energy Group), a holding company for subsidiaries engaged in pursuing competitive business opportunities across energy services and distributed solar to commercial and industrial customers. SCE’s projects include West of Devers, Mesa Substation, Alberhill System, Riverside Transmission Reliability, Eldorado-Lugo-Mohave Upgrade, Tehachapi and Coolwater-Lugo. As of December 31, 2016, the West of Devers Project consisted of upgrading and reconfiguring approximately 48 miles of existing 220 kilovolt (kV) transmission lines between the Devers, El Casco, Vista and San Bernardino substations.
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