Head to Head Contrast: DTE Energy (NYSE:DTE) and Xcel Energy (NASDAQ:XEL)

DTE Energy (NYSE:DTE) and Xcel Energy (NASDAQ:XEL) are both large-cap utilities companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, valuation and institutional ownership.

Profitability

This table compares DTE Energy and Xcel Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DTE Energy	7.65%	12.37%	2.84%
Xcel Energy	14.14%	10.37%	2.90%

Institutional and Insider Ownership

76.1% of DTE Energy shares are held by institutional investors. Comparatively, 78.4% of Xcel Energy shares are held by institutional investors. 0.6% of DTE Energy shares are held by insiders. Comparatively, 0.2% of Xcel Energy shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

DTE Energy pays an annual dividend of $4.66 per share and has a dividend yield of 3.2%. Xcel Energy pays an annual dividend of $2.37 per share and has a dividend yield of 3.0%. DTE Energy pays out 76.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Xcel Energy pays out 68.3% of its earnings in the form of a dividend. DTE Energy has increased its dividend for 16 consecutive years and Xcel Energy has increased its dividend for 22 consecutive years.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DTE Energy	$15.81 billion	1.92	$1.46 billion	$6.07	24.07
Xcel Energy	$14.78 billion	3.31	$2.02 billion	$3.47	22.56

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

Risk & Volatility

DTE Energy has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500. Comparatively, Xcel Energy has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for DTE Energy and Xcel Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DTE Energy	0	4	9	1	2.79
Xcel Energy	1	0	13	3	3.06

DTE Energy currently has a consensus price target of $156.25, suggesting a potential upside of 6.96%. Xcel Energy has a consensus price target of $90.63, suggesting a potential upside of 15.79%. Given Xcel Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Xcel Energy is more favorable than DTE Energy.

Summary

Xcel Energy beats DTE Energy on 11 of the 17 factors compared between the two stocks.

About DTE Energy

DTE Energy Company engages in the utility operations. The company's Electric segment generates, purchases, distributes, and sells electricity to various residential, commercial, and industrial customers in southeastern Michigan. It generates electricity through coal-fired plants, hydroelectric pumped storage, and nuclear plants, as well as wind and solar assets. This segment owns and operates distribution substations and line transformers. The company's Gas segment purchases, stores, transports, distributes, and sells natural gas to various residential, commercial, and industrial customers throughout Michigan; and sells storage and transportation capacity. Its DTE Vantage segment offers metallurgical and petroleum coke to steel and other industries; and power generation, steam production, chilled water production, and wastewater treatment services, as well as air supplies compressed air to industrial customers. Its Energy Trading segment engages in power, natural gas, and environmental marketing and trading; structured transactions; and the optimization of contracted natural gas pipeline transportation and storage positions. The company was founded in 1849 and is based in Detroit, Michigan.

About Xcel Energy

Xcel Energy Inc., through its subsidiaries, engages in the generation, purchasing, transmission, distribution, and sale of electricity. It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments. The company generates electricity through wind, nuclear, hydroelectric, biomass, and solar energy sources, as well as coal, natural gas, oil, wood, and refuse-derived fuels. It also purchases, transports, distributes, and sells natural gas to retail customers, as well as transports customer-owned natural gas. In addition, the company develops and leases natural gas pipelines, and storage and compression facilities; and invests in rental housing projects and nonregulated assets, as well as procures equipment for the construction of renewable generation facilities. It serves residential, commercial, and industrial customers in the portions of Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas, and Wisconsin. The company was incorporated in 1909 and is headquartered in Minneapolis, Minnesota.