NextEra Energy (NYSE:NEE) & Public Service Enterprise Group (NYSE:PEG) Head to Head Survey

Public Service Enterprise Group (NYSE:PEG) and NextEra Energy (NYSE:NEE) are both large-cap utilities companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Profitability

This table compares Public Service Enterprise Group and NextEra Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Public Service Enterprise Group	17.78%	12.08%	3.58%
NextEra Energy	24.72%	12.42%	3.88%

Dividends

Public Service Enterprise Group pays an annual dividend of $2.52 per share and has a dividend yield of 3.1%. NextEra Energy pays an annual dividend of $2.26 per share and has a dividend yield of 2.7%. Public Service Enterprise Group pays out 60.6% of its earnings in the form of a dividend. NextEra Energy pays out 72.0% 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. Public Service Enterprise Group has increased its dividend for 14 consecutive years and NextEra Energy has increased its dividend for 31 consecutive years. Public Service Enterprise Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Public Service Enterprise Group and NextEra Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Public Service Enterprise Group	$11.72 billion	3.44	$1.77 billion	$4.16	19.40
NextEra Energy	$26.30 billion	6.70	$6.95 billion	$3.14	26.96

NextEra Energy has higher revenue and earnings than Public Service Enterprise Group. Public Service Enterprise Group is trading at a lower price-to-earnings ratio than NextEra Energy, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Public Service Enterprise Group has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500. Comparatively, NextEra Energy has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500.

Insider and Institutional Ownership

73.3% of Public Service Enterprise Group shares are owned by institutional investors. Comparatively, 78.7% of NextEra Energy shares are owned by institutional investors. 0.2% of Public Service Enterprise Group shares are owned by company insiders. Comparatively, 0.2% of NextEra Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for Public Service Enterprise Group and NextEra Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Public Service Enterprise Group	0	6	8	0	2.57
NextEra Energy	0	5	13	3	2.90

Public Service Enterprise Group currently has a consensus target price of $91.19, suggesting a potential upside of 12.99%. NextEra Energy has a consensus target price of $91.00, suggesting a potential upside of 7.51%. Given Public Service Enterprise Group’s higher probable upside, analysts clearly believe Public Service Enterprise Group is more favorable than NextEra Energy.

Summary

NextEra Energy beats Public Service Enterprise Group on 13 of the 18 factors compared between the two stocks.

About Public Service Enterprise Group

Public Service Enterprise Group Incorporated, through its subsidiaries, operates in electric and gas utility business in the United States. It operates through PSE&G and PSEG Power segments. The PSE&G segment transmits electricity; distributes electricity and natural gas to residential, commercial, and industrial customers; and appliance services and repairs to customers through its service territory, as well as invests in solar generation projects, and energy efficiency and related programs. The PSEG Power segment engages in nuclear generation businesses; and supplies power and natural gas to nuclear power plants and gas storage facilities activities. As of December 31, 2023, it had electric transmission and distribution system of 25,000 circuit miles and 866,600 poles; 56 switching stations with an installed capacity of 39,953 megavolt-amperes (MVA), and 235 substations with an installed capacity of 10,382 MVA; 109 MVA aggregate installed capacity for substations; four electric distribution headquarters and five electric sub-headquarters; 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 56 natural gas metering and regulating stations; and 158 MegaWatts defined conditions of installed PV solar capacity. Public Service Enterprise Group Incorporated was founded in 1903 and is based in Newark, New Jersey.

About NextEra Energy

NextEra Energy, Inc., through its subsidiaries, generates, transmits, distributes, and sells electric power to retail and wholesale customers in North America. The company generates electricity through wind, solar, nuclear,natural gas, and other clean energy. It also develops, constructs, and operates long-term contracted assets that consists of clean energy solutions, such as renewable generation facilities, battery storage projects, and electric transmission facilities; sells energy commodities; and owns, develops, constructs, manages and operates electric generation facilities in wholesale energy markets. The company had approximately 33,276 megawatts of net generating capacity; approximately 90,000 circuit miles of transmission and distribution lines; and 883 substations. It serves approximately 12 million people through approximately 5.9 million customer accounts in the east and lower west coasts of Florida. The company was formerly known as FPL Group, Inc. and changed its name to NextEra Energy, Inc. in 2010. NextEra Energy, Inc. was founded in 1925 and is headquartered in Juno Beach, Florida.