Allete (NYSE: ALE) and NV Energy (NYSE:NVE) are both utilities companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, dividends, risk and analyst recommendations.

Earnings and Valuation

This table compares Allete and NV Energy’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Allete $1.41 billion 2.85 $412.30 million $3.39 23.28
NV Energy N/A N/A N/A N/A N/A

Allete has higher revenue and earnings than NV Energy.

Dividends

Allete pays an annual dividend of $2.14 per share and has a dividend yield of 2.7%. NV Energy does not pay a dividend. Allete pays out 63.1% of its earnings in the form of a dividend. Allete has increased its dividend for 6 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Allete and NV Energy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allete 1 4 0 0 1.80
NV Energy 0 0 0 0 N/A

Allete presently has a consensus price target of $76.67, suggesting a potential downside of 2.87%. Given Allete’s higher probable upside, analysts plainly believe Allete is more favorable than NV Energy.

Profitability

This table compares Allete and NV Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allete 12.09% 9.21% 3.65%
NV Energy N/A N/A N/A

Institutional and Insider Ownership

71.0% of Allete shares are held by institutional investors. 0.4% of Allete shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Allete beats NV Energy on 9 of the 10 factors compared between the two stocks.

About Allete

ALLETE, Inc. is an energy company. The Company’s segments include Regulated Operations, ALLETE Clean Energy, Inc. (ALLETE Clean Energy), U.S. Water Services Holding Company (U.S. Water Services), and Corporate and Other. The Regulated Operations segment includes its regulated utilities, Minnesota Power, and Superior Water, Light and Power Company, and its investment in American Transmission Company LLC. The ALLETE Clean Energy segment focuses on developing, acquiring and operating clean and renewable energy projects. The U.S. Water Services provides integrated water management for industry by combining chemical, equipment, engineering and service for customized solution. As of December 31, 2016, its Corporate and Other consisted of BNI Energy, Inc. (BNI Energy), its coal mining operations in North Dakota, ALLETE Properties, LLC (ALLETE Properties), its Florida real estate investment and approximately 5,000 acres of land in Minnesota.

About NV Energy

NV Energy, Inc. (NVE) is an investor-owned holding company. NVE has four primary, wholly owned subsidiaries: Nevada Power Company (NPC), doing business as NV Energy, Sierra Pacific Power Company (SPPC) doing business as NV Energy, NVE Insurance Company, Inc. and Lands of Sierra. The NPC and SPPC (Utilities) operate three business segments: NPC electric; SPPC electric, and SPPC natural gas. Electric service is provided by NPC to Las Vegas and surrounding Clark County, and by SPPC to northern Nevada. Natural gas service is provided by SPPC in the Reno-Sparks area of Nevada. Nevada Electrical Investment Company (NEICO) is a wholly owned subsidiary of NPC. On December 19, 2013, MidAmerican Energy Holdings Company (MidAmerican) completed the merger of NV Energy, Inc. (NVE) and Silver Merger Sub, Inc., a subsidiary of MidAmerican, and following the completion of the merger (the NVE Merger) NVE became an indirect wholly owned subsidiary of MidAmerican.

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