Critical Review: Energias de Portugal (OTCMKTS:EDPFY) vs. Public Service Enterprise Group (NYSE:PEG)

Energias de Portugal (OTCMKTS:EDPFY) and Public Service Enterprise Group (NYSE:PEG) are both utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Profitability

This table compares Energias de Portugal and Public Service Enterprise Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Energias de Portugal	N/A	N/A	N/A
Public Service Enterprise Group	17.77%	12.62%	3.74%

Analyst Recommendations

This is a summary of current ratings and target prices for Energias de Portugal and Public Service Enterprise Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Energias de Portugal	0	1	1	0	2.50
Public Service Enterprise Group	0	4	10	1	2.80

Public Service Enterprise Group has a consensus target price of $90.96, suggesting a potential upside of 12.04%. Given Public Service Enterprise Group’s stronger consensus rating and higher probable upside, analysts clearly believe Public Service Enterprise Group is more favorable than Energias de Portugal.

Valuation & Earnings

This table compares Energias de Portugal and Public Service Enterprise Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Energias de Portugal	N/A	N/A	N/A	$1.19	43.34
Public Service Enterprise Group	$10.29 billion	3.94	$1.77 billion	$4.16	19.52

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

Dividends

Energias de Portugal pays an annual dividend of $1.43 per share and has a dividend yield of 2.8%. Public Service Enterprise Group pays an annual dividend of $2.52 per share and has a dividend yield of 3.1%. Energias de Portugal pays out 120.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Public Service Enterprise Group pays out 60.6% of its earnings in the form of a dividend. Public Service Enterprise Group has increased its dividend for 14 consecutive years. Public Service Enterprise Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

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

Volatility and Risk

Energias de Portugal has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, Public Service Enterprise Group has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.

Summary

Public Service Enterprise Group beats Energias de Portugal on 14 of the 15 factors compared between the two stocks.

About Energias de Portugal

EDP – Energias de Portugal, S.A. engages in the generation, transmission, distribution, and supply of electricity in Portugal, Spain, France, Poland, Romania, Italy, Belgium, the United Kingdom, Greece, Colombia, Brazil, North America, and internationally. It operates through Renewables, Networks, and Client Solutions & Energy Management segments. The company primarily generates and sells electricity through hydro, CCGT, coal, wind, solar, nuclear, and cogeneration and waste sources. It has an installed capacity of 28 GW; and operates 380,788 kilometers of distribution network lines. The company is also involved in the supply of natural gas. In addition, it offers engineering, laboratory tests, professional training, and energy services, as well as property management services. The company's electricity and gas customers include domestic, industrial, commercial, agricultural, and others. The company was incorporated in 1976 and is headquartered in Lisbon, Portugal.

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.