Reviewing Delta Natural Gas (DGAS) & Just Energy Group (JE)
Delta Natural Gas (NASDAQ: DGAS) and Just Energy Group (NYSE:JE) are both small-cap utilities companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.
Risk & Volatility
Delta Natural Gas has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500. Comparatively, Just Energy Group has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500.
This is a breakdown of current ratings and recommmendations for Delta Natural Gas and Just Energy Group, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Delta Natural Gas||0||0||0||0||N/A|
|Just Energy Group||0||2||2||0||2.50|
Just Energy Group has a consensus price target of $8.19, suggesting a potential upside of 47.26%. Given Just Energy Group’s higher probable upside, analysts clearly believe Just Energy Group is more favorable than Delta Natural Gas.
Earnings and Valuation
This table compares Delta Natural Gas and Just Energy Group’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Delta Natural Gas||$68.84 million||3.18||$19.26 million||$0.89||34.48|
|Just Energy Group||$2.88 billion||0.28||$162.52 million||$0.05||111.20|
Just Energy Group has higher revenue and earnings than Delta Natural Gas. Delta Natural Gas is trading at a lower price-to-earnings ratio than Just Energy Group, indicating that it is currently the more affordable of the two stocks.
Delta Natural Gas pays an annual dividend of $0.75 per share and has a dividend yield of 2.4%. Just Energy Group pays an annual dividend of $0.40 per share and has a dividend yield of 7.2%. Delta Natural Gas pays out 84.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Just Energy Group pays out 800.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional & Insider Ownership
36.8% of Delta Natural Gas shares are owned by institutional investors. Comparatively, 29.0% of Just Energy Group shares are owned by institutional investors. 4.2% of Delta Natural Gas shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Delta Natural Gas and Just Energy Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Delta Natural Gas||-3.88%||-2.51%||-1.03%|
|Just Energy Group||2.18%||-117.41%||18.57%|
Just Energy Group beats Delta Natural Gas on 8 of the 15 factors compared between the two stocks.
About Delta Natural Gas
Delta Natural Gas Company, Inc. distributes or transports natural gas to approximately 36,000 customers. The Company’s segments include regulated segment and non-regulated segment. Through regulated segment, the Company distributes natural gas to its retail customers in approximately 23 rural counties. Its three service areas are Nicholasville, Corbin and Berea, Kentucky. The non-regulated segment includes the Company’s three subsidiaries, Delta Resources, Inc. and Delgasco, Inc. (Delgasco), which purchase natural gas in the open market, including natural gas from Kentucky producers, and Enpro, Inc. (Enpro), which produces natural gas that is sold to Delgasco for resale in the open market. The Company owns approximately 2,600 miles of natural gas gathering, transmission, distribution and storage lines. These lines range in size over 12 inches in diameter. It also holds leases for the storage of natural gas under approximately 8,000 acres located in Bell County, Kentucky.
About Just Energy Group
Just Energy Group Inc. (Just Energy) is an energy management solutions provider engaged in electricity, natural gas, solar and green energy. The Company’s segments include Consumer Energy and Commercial Energy. The Company operates in the United States, Canada and the United Kingdom, offering a range of energy products, including long-term fixed-price, variable rate and flat bill programs; home energy management services, including smart thermostats and tools to manage energy use at the appliance level, and residential solar panel installations. It markets under the brands, such as Just Energy, Hudson Energy, Amigo Energy, GreenStar Energy, Just Solar, Tara Energy and TerraPass. Just Energy’s commercial business is operated primarily through Hudson Energy. Hudson Energy offers fixed and variable rate natural gas and electricity contracts, as well as customized products. Just Energy also offers green products through its JustGreen Electricity and Natural Gas and TerraPass programs.
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