Atlantic Power Corporation (NYSE: AT) and MGE Energy (NASDAQ:MGEE) are both utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitabiliy and earnings.

Volatility and Risk

Atlantic Power Corporation has a beta of 1.74, indicating that its share price is 74% more volatile than the S&P 500. Comparatively, MGE Energy has a beta of 0.35, indicating that its share price is 65% less volatile than the S&P 500.

Earnings & Valuation

This table compares Atlantic Power Corporation and MGE Energy’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Atlantic Power Corporation $391.20 million 0.71 $152.70 million ($0.96) -2.50
MGE Energy $554.04 million 4.09 $178.18 million $2.23 29.33

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

Insider and Institutional Ownership

46.4% of Atlantic Power Corporation shares are owned by institutional investors. Comparatively, 37.7% of MGE Energy shares are owned by institutional investors. 1.6% of Atlantic Power Corporation shares are owned by insiders. Comparatively, 0.2% of MGE Energy shares are owned 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

MGE Energy pays an annual dividend of $1.23 per share and has a dividend yield of 1.9%. Atlantic Power Corporation does not pay a dividend. MGE Energy pays out 55.2% of its earnings in the form of a dividend. MGE Energy has raised its dividend for 41 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and price targets for Atlantic Power Corporation and MGE Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atlantic Power Corporation 0 3 0 0 2.00
MGE Energy 0 0 0 0 N/A

Atlantic Power Corporation presently has a consensus target price of $2.63, indicating a potential upside of 9.38%. Given Atlantic Power Corporation’s higher probable upside, equities analysts plainly believe Atlantic Power Corporation is more favorable than MGE Energy.

Profitability

This table compares Atlantic Power Corporation and MGE Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atlantic Power Corporation -25.71% 27.03% 1.21%
MGE Energy 13.82% 10.60% 4.33%

Summary

MGE Energy beats Atlantic Power Corporation on 9 of the 15 factors compared between the two stocks.

About Atlantic Power Corporation

Alltel Corporation provides telecommunication services such as wire line local, long-distance, network access and internet services, wireless communications and wide-area paging services. The Company also wholesales telecommunications equipment and publishes telephone directories.

About MGE Energy

MGE Energy, Inc. (MGE) is a public utility holding company. The Company operates through five segments: Regulated electric utility operations; Regulated gas utility operations; Nonregulated energy operations; Transmission investments, and All other. The Regulated electric utility operations segment is engaged in generating, purchasing and distributing electricity through Madison Gas and Electric Company (MGE). The Regulated gas utility operations segment is engaged in purchasing and distributing natural gas through MGE. The Nonregulated energy operations segment is engaged in owning and leasing electric generating capacity that assists MGE through MGE Energy’s subsidiaries MGE Power Elm Road, LLC and MGE Power West Campus, LLC. The Transmission investments segment represents its investment in American Transmission Company LLC and ATC Holdco, LLC. The All other segment is engaged in investing and financing in companies and property that relate to the regulated operations.

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