Contrasting Dominion Energy (NYSE:D) & Ameren (NYSE:AEE)

Ameren (NYSE:AEE) and Dominion Energy (NYSE:D) are both large-cap utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.

Institutional and Insider Ownership

79.1% of Ameren shares are owned by institutional investors. Comparatively, 73.0% of Dominion Energy shares are owned by institutional investors. 0.4% of Ameren shares are owned by insiders. Comparatively, 0.1% of Dominion Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Ameren and Dominion Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ameren	15.75%	10.92%	2.96%
Dominion Energy	16.17%	9.60%	2.69%

Analyst Recommendations

This is a summary of recent ratings for Ameren and Dominion Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ameren	1	6	5	1	2.46
Dominion Energy	1	9	2	0	2.08

Ameren presently has a consensus price target of $109.60, indicating a potential upside of 6.17%. Dominion Energy has a consensus price target of $64.33, indicating a potential upside of 7.03%. Given Dominion Energy’s higher probable upside, analysts clearly believe Dominion Energy is more favorable than Ameren.

Risk & Volatility

Ameren has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500. Comparatively, Dominion Energy has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Dividends

Ameren pays an annual dividend of $2.84 per share and has a dividend yield of 2.8%. Dominion Energy pays an annual dividend of $2.67 per share and has a dividend yield of 4.4%. Ameren pays out 54.6% of its earnings in the form of a dividend. Dominion Energy pays out 90.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ameren has raised its dividend for 12 consecutive years.

Earnings and Valuation

This table compares Ameren and Dominion Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ameren	$8.96 billion	3.12	$1.18 billion	$5.20	19.85
Dominion Energy	$14.46 billion	3.55	$2.12 billion	$2.94	20.44

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

Summary

Ameren beats Dominion Energy on 10 of the 18 factors compared between the two stocks.

About Ameren

Ameren Corporation, together with its subsidiaries, operates as a public utility holding company in the United States. The company operates through four segments: Ameren Missouri, Ameren Illinois Electric Distribution, Ameren Illinois Natural Gas, and Ameren Transmission. It engages in the rate-regulated electric generation, transmission, and distribution activities; and rate-regulated natural gas distribution business. In addition, the company generates electricity through coal, nuclear, and natural gas, as well as renewable sources, such as hydroelectric, wind, methane gas, and solar. It serves residential, commercial, and industrial customers. The company was founded in 1881 and is headquartered in Saint Louis, Missouri.

About Dominion Energy

Dominion Energy, Inc. produces and distributes energy in the United States. It operates through three operating segments: Dominion Energy Virginia, Dominion Energy South Carolina, and Contracted Energy. The Dominion Energy Virginia segment generates, transmits, and distributes regulated electricity to approximately 2.8 million residential, commercial, industrial, and governmental customers in Virginia and North Carolina. The Dominion Energy South Carolina segment generates, transmits, and distributes electricity to approximately 0.8 million customers in the central, southern, and southwestern portions of South Carolina; and distributes natural gas to approximately 0.4 million residential, commercial, and industrial customers in South Carolina. The Contracted Energy segment is involved in the nonregulated long-term contracted renewable electric generation and renewable natural gas facility. As of December 31, 2023, the company's portfolio of assets included approximately 29.5 gigawatt of electric generating capacity; 10,600 miles of electric transmission lines; 79,300 miles of electric distribution lines; and 94,800 miles of gas distribution mains and related service facilities. The company was formerly known as Dominion Resources, Inc. Dominion Energy, Inc. was incorporated in 1983 and is headquartered in Richmond, Virginia.