Head-To-Head Contrast: National Grid Transco, PLC (NGG) & Avista Corporation (AVA)
National Grid Transco, PLC (NYSE: NGG) and Avista Corporation (NYSE:AVA) are both mid-cap utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.
This table compares National Grid Transco, PLC and Avista Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|National Grid Transco, PLC||N/A||N/A||N/A|
Institutional and Insider Ownership
5.1% of National Grid Transco, PLC shares are held by institutional investors. Comparatively, 69.7% of Avista Corporation shares are held by institutional investors. 1.1% of Avista Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares National Grid Transco, PLC and Avista Corporation’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|National Grid Transco, PLC||$19.34 billion||2.27||$6.55 billion||N/A||N/A|
|Avista Corporation||$1.46 billion||2.27||$471.76 million||$2.11||24.36|
National Grid Transco, PLC has higher revenue and earnings than Avista Corporation.
Risk and Volatility
National Grid Transco, PLC has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500. Comparatively, Avista Corporation has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500.
National Grid Transco, PLC pays an annual dividend of $2.89 per share and has a dividend yield of 4.5%. Avista Corporation pays an annual dividend of $1.43 per share and has a dividend yield of 2.8%. Avista Corporation pays out 67.8% of its earnings in the form of a dividend. National Grid Transco, PLC has raised its dividend for 14 consecutive years. National Grid Transco, PLC is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current ratings and price targets for National Grid Transco, PLC and Avista Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|National Grid Transco, PLC||2||6||7||0||2.33|
National Grid Transco, PLC presently has a consensus target price of $69.00, indicating a potential upside of 8.10%. Avista Corporation has a consensus target price of $44.00, indicating a potential downside of 14.40%. Given National Grid Transco, PLC’s stronger consensus rating and higher probable upside, analysts plainly believe National Grid Transco, PLC is more favorable than Avista Corporation.
National Grid Transco, PLC beats Avista Corporation on 10 of the 15 factors compared between the two stocks.
About National Grid Transco, PLC
National Grid plc is an electricity and gas utility company focused on transmission and distribution activities in electricity and gas in both the United Kingdom and the United States. The Company’s segments include UK Electricity Transmission, which is engaged in high voltage electricity transmission networks in Great Britain; UK Gas Transmission, which is the gas transmission network in Great Britain and United Kingdom liquefied natural gas (LNG) storage activities; UK Gas Distribution, which includes approximately four of the eight regional networks of Great Britain’s gas distribution system, and US Regulated, which includes gas distribution networks, electricity distribution networks and high voltage electricity transmission networks in New York, and New England and electricity generation facilities in New York. Its other activities relate to non-regulated businesses and other commercial operations not included within the above segments.
About Avista Corporation
Avista Corporation is an electric and natural gas utility company. The Company operates through two segments: Avista Utilities, and Alaska Electric Light and Power Company (AEL&P). The Company’s regional services include government and higher education, medical services, retail trade and finance. The Company’s businesses also include sheet metal fabrication, venture fund investments, real estate investments, a company that explores markets that could be served with liquefied natural gas (LNG), as well as certain other investments of Avista Capital, which is a subsidiary of the Company. Avista Utilities is an operating division of the Company, which consists of its regulated utility operations in the Pacific Northwest. Avista Utilities division generates, transmits and distributes electricity, and distributes natural gas. As of December 31, 2016, AEL&P operated five hydroelectric generation facilities with 102.7 megawatts (MW) of hydroelectric generation capacity.
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