Critical Survey: Portland General Electric (POR) and CPFL Energia (CPL)

Portland General Electric (NYSE:POR) and CPFL Energia (NYSE:CPL) are both mid-cap utilities companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.

Profitability

This table compares Portland General Electric and CPFL Energia’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Portland General Electric 9.74% 8.59% 2.66%
CPFL Energia 5.89% 14.68% 4.04%

Risk & Volatility

Portland General Electric has a beta of 0.17, meaning that its share price is 83% less volatile than the S&P 500. Comparatively, CPFL Energia has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Portland General Electric and CPFL Energia, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Portland General Electric 2 5 1 0 1.88
CPFL Energia 0 0 0 0 N/A

Portland General Electric presently has a consensus target price of $42.81, suggesting a potential downside of 5.01%. Given Portland General Electric’s higher probable upside, equities research analysts clearly believe Portland General Electric is more favorable than CPFL Energia.

Insider and Institutional Ownership

92.9% of Portland General Electric shares are held by institutional investors. Comparatively, 0.4% of CPFL Energia shares are held by institutional investors. 0.6% of Portland General Electric 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

Portland General Electric pays an annual dividend of $1.45 per share and has a dividend yield of 3.2%. CPFL Energia pays an annual dividend of $0.13 per share and has a dividend yield of 1.0%. Portland General Electric pays out 63.3% of its earnings in the form of a dividend. Portland General Electric has raised its dividend for 12 consecutive years and CPFL Energia has raised its dividend for 4 consecutive years. Portland General Electric is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Portland General Electric and CPFL Energia’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Portland General Electric $2.01 billion 2.00 $187.00 million $2.29 19.68
CPFL Energia $8.38 billion 0.80 $369.49 million N/A N/A

CPFL Energia has higher revenue and earnings than Portland General Electric.

Summary

Portland General Electric beats CPFL Energia on 9 of the 15 factors compared between the two stocks.

Portland General Electric Company Profile

Portland General Electric Company, an integrated electric utility company, engages in the generation, wholesale purchase, transmission, distribution, and retail sale of electricity in the state of Oregon. The company operates seven thermal plants; seven hydroelectric plants; and two wind farms. As of December 31, 2017, it owned an electric transmission system consisting of 1,250 circuit miles, including 287 circuit miles of 500 kilovolt line, 402 circuit miles of 230 kilovolt line, and 561 miles of 115 kilovolt line. It has 27,457 circuit miles of distribution lines. The company also purchases and sells electricity and natural gas in the wholesale market to utilities and power marketers in the United States and Canada. It serves approximately 875,000 residential, commercial, and industrial customers in the Portland/Salem metropolitan area of Oregon. The company was founded in 1930 and is headquartered in Portland, Oregon.

CPFL Energia Company Profile

CPFL Energia S.A., together with its subsidiaries, generates, transmits, distributes, and commercializes electricity to residential, industrial, and commercial customers in Brazil. The company generates electricity through wind, biomass-powered thermal, solar, and hydroelectric power plants. It also manufactures, commercializes, rents, and maintains electro-mechanical equipment; and offers administrative, call center, collection, IT, telecommunication, energy transmission, and energy efficiency management services, as well as maintenance services for energy generation companies. As of December 31, 2017, the company distributed electricity to approximately 9.4 million customers; and had 318,018 kilometers of distribution lines, which included 457,741 distribution transformers. It also has an installed capacity of 3,284 megawatts. CPFL Energia S.A. was founded in 1998 and is headquartered in Campinas, Brazil. CPFL Energia S.A. is a subsidiary of State Grid Brazil Power ParticipaƧƵes Ltda.

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