Alliant Energy (LNT) & DTE Energy (DTE) Critical Review
Alliant Energy (NYSE: LNT) and DTE Energy (NYSE:DTE) are both mid-cap utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, earnings, institutional ownership, valuation and risk.
Alliant Energy pays an annual dividend of $1.26 per share and has a dividend yield of 3.0%. DTE Energy pays an annual dividend of $3.53 per share and has a dividend yield of 3.3%. Alliant Energy pays out 68.1% of its earnings in the form of a dividend. DTE Energy pays out 64.5% 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. Alliant Energy has increased its dividend for 11 consecutive years and DTE Energy has increased its dividend for 5 consecutive years. DTE Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a summary of recent ratings and price targets for Alliant Energy and DTE Energy, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Alliant Energy currently has a consensus target price of $42.20, suggesting a potential upside of 1.10%. DTE Energy has a consensus target price of $114.19, suggesting a potential upside of 5.63%. Given DTE Energy’s stronger consensus rating and higher possible upside, analysts plainly believe DTE Energy is more favorable than Alliant Energy.
This table compares Alliant Energy and DTE Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Alliant Energy and DTE Energy’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Alliant Energy||$3.32 billion||2.91||$381.70 million||$1.85||22.56|
|DTE Energy||$10.63 billion||1.82||$868.00 million||$5.47||19.76|
DTE Energy has higher revenue and earnings than Alliant Energy. DTE Energy is trading at a lower price-to-earnings ratio than Alliant Energy, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
68.5% of Alliant Energy shares are owned by institutional investors. Comparatively, 68.3% of DTE Energy shares are owned by institutional investors. 0.3% of Alliant Energy shares are owned by insiders. Comparatively, 0.5% of DTE Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Volatility and Risk
Alliant Energy has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500. Comparatively, DTE Energy has a beta of 0.23, indicating that its stock price is 77% less volatile than the S&P 500.
DTE Energy beats Alliant Energy on 9 of the 17 factors compared between the two stocks.
Alliant Energy Company Profile
Alliant Energy Corporation operates as a regulated investor-owned public utility holding company. The Company’s segments include Utility and Non-regulated, Parent and Other. The Utility segment includes the operations of Interstate Power and Light Company (IPL) and Wisconsin Power and Light Company (WPL), which serve retail customers in Iowa and Wisconsin. The Utility segment includes utility electric operations, utility gas operations and utility other, which includes steam operations and the unallocated portions of the utility business. Its Non-regulated, Parent and Other segment includes the operations of Alliant Energy Resources, LLC and its subsidiaries; Alliant Energy Corporate Services, Inc. (Corporate Services); the Alliant Energy parent company, and any Alliant Energy parent company consolidating adjustments. IPL and WPL own a portfolio of electric generating units located in Iowa, Wisconsin and Minnesota with a fuel mix, including coal, natural gas and renewable resources.
DTE Energy Company Profile
DTE Energy Company is an energy company. Its segments include Electric, which consists of DTE Electric Company, which is engaged in the generation, purchase, distribution and sale of electricity to residential, commercial and industrial customers in southeastern Michigan; Gas, which consists of DTE Gas Company, which is engaged in the purchase, storage, transportation, distribution and sale of natural gas to residential, commercial and industrial customers throughout Michigan; Gas Storage and Pipelines, which consists of natural gas pipeline, gathering and storage businesses; Power and Industrial Projects, which consists of projects that deliver energy and utility-type products and services to industrial, commercial and institutional customers, and sell electricity from renewable energy projects; Energy Trading, which consists of energy marketing and trading operations, and Corporate and Other, which includes various holding company activities and holds certain non-utility debt.
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