Otter Tail Corporation (NASDAQ: OTTR) and Hawaiian Electric Industries (NYSE:HE) are both electric utilities – nec companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, profitability, dividends, earnings, valuation and institutional ownership.

Volatility & Risk

Otter Tail Corporation has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Hawaiian Electric Industries has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500.

Insider & Institutional Ownership

40.5% of Otter Tail Corporation shares are held by institutional investors. Comparatively, 47.9% of Hawaiian Electric Industries shares are held by institutional investors. 1.4% of Otter Tail Corporation shares are held by insiders. Comparatively, 0.9% of Hawaiian Electric Industries shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Otter Tail Corporation pays an annual dividend of $1.28 per share and has a dividend yield of 2.8%. Hawaiian Electric Industries pays an annual dividend of $1.24 per share and has a dividend yield of 3.4%. Otter Tail Corporation pays out 71.1% of its earnings in the form of a dividend. Hawaiian Electric Industries pays out 76.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings and Valuation

This table compares Otter Tail Corporation and Hawaiian Electric Industries’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Otter Tail Corporation $803.54 million 2.26 $62.32 million $1.80 25.47
Hawaiian Electric Industries $2.38 billion 1.68 $250.14 million $1.63 22.60

Hawaiian Electric Industries has higher revenue and earnings than Otter Tail Corporation. Hawaiian Electric Industries is trading at a lower price-to-earnings ratio than Otter Tail Corporation, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and target prices for Otter Tail Corporation and Hawaiian Electric Industries, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Otter Tail Corporation 0 2 1 0 2.33
Hawaiian Electric Industries 3 1 0 0 1.25

Otter Tail Corporation presently has a consensus target price of $41.00, indicating a potential downside of 10.58%. Hawaiian Electric Industries has a consensus target price of $32.33, indicating a potential downside of 12.23%. Given Otter Tail Corporation’s stronger consensus rating and higher possible upside, equities analysts plainly believe Otter Tail Corporation is more favorable than Hawaiian Electric Industries.

Profitability

This table compares Otter Tail Corporation and Hawaiian Electric Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Otter Tail Corporation 8.53% 10.47% 3.68%
Hawaiian Electric Industries 7.14% 8.64% 1.42%

Summary

Otter Tail Corporation beats Hawaiian Electric Industries on 12 of the 16 factors compared between the two stocks.

About Otter Tail Corporation

Otter Tail Corporation is a holding company. The Company operates through three segments: Electric, Manufacturing and Plastics. The Electric segment includes the production, transmission, distribution and sale of electric energy in Minnesota, North Dakota and South Dakota by Otter Tail Power Company (OTP). The Manufacturing segment consists of businesses in manufacturing activities, such as contract machining, metal parts stamping, fabrication and painting, and production of material and handling trays and horticultural containers. These businesses have manufacturing facilities in Georgia, Illinois and Minnesota and sell products primarily in the United States. The Plastics segment consists of businesses producing polyvinyl chloride (PVC) pipe at plants in North Dakota and Arizona. The PVC pipe is sold primarily in the upper Midwest and Southwest regions of the United States. The Company’s manufacturing and plastic pipe businesses are owned by its subsidiary, Varistar Corporation.

About Hawaiian Electric Industries

Hawaiian Electric Industries, Inc. is a holding company with its principal subsidiaries engaged in electric utility and banking businesses operating primarily in the State of Hawaii. The Company’s subsidiaries include Hawaiian Electric Company, Inc. (Hawaiian Electric) and ASB Hawaii, Inc. (ASB Hawaii). Its segments include Electric utility, Bank and Other. It operates its electric utility business through Hawaiian Electric and its subsidiaries, Hawaii Electric Light Company, Inc. (Hawaii Electric Light) and Maui Electric Company, Limited (Maui Electric). It operates its Bank segment through ASB Hawaii’s subsidiary, American Savings Bank, F.S.B. (ASB). Its electric public utilities are in the business of generating, purchasing, transmitting, distributing and selling electric energy. ASB is a federally chartered savings bank providing a range of banking services to individual and business customers.

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