Avangrid (NYSE: AGR) and PPL Corporation (NYSE:PPL) are both large-cap utilities companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, dividends, earnings, risk and profitability.

Profitability

This table compares Avangrid and PPL Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Avangrid 11.25% 4.52% 2.20%
PPL Corporation 22.08% 15.96% 4.16%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Avangrid and PPL Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Avangrid 0 0 4 0 3.00
PPL Corporation 0 5 2 0 2.29

Avangrid currently has a consensus target price of $46.17, suggesting a potential downside of 2.89%. PPL Corporation has a consensus target price of $38.36, suggesting a potential upside of 1.69%. Given PPL Corporation’s higher probable upside, analysts plainly believe PPL Corporation is more favorable than Avangrid.

Volatility and Risk

Avangrid has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500. Comparatively, PPL Corporation has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500.

Earnings & Valuation

This table compares Avangrid and PPL Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Avangrid $6.00 billion 2.45 $1.94 billion $2.18 21.81
PPL Corporation $7.40 billion 3.50 $4.04 billion $2.39 15.78

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

Insider & Institutional Ownership

13.2% of Avangrid shares are owned by institutional investors. Comparatively, 71.0% of PPL Corporation shares are owned by institutional investors. 0.3% of Avangrid shares are owned by company insiders. Comparatively, 0.4% of PPL Corporation shares are owned by company 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

Avangrid pays an annual dividend of $1.73 per share and has a dividend yield of 3.6%. PPL Corporation pays an annual dividend of $1.58 per share and has a dividend yield of 4.2%. Avangrid pays out 79.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PPL Corporation pays out 66.1% of its earnings in the form of a dividend. PPL Corporation has increased its dividend for 5 consecutive years. PPL Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

PPL Corporation beats Avangrid on 13 of the 16 factors compared between the two stocks.

About Avangrid

Avangrid, Inc. is an energy and utility company. The Company operates through three segments: Networks, Renewables and Gas. The Networks segment includes all the energy transmission and distribution activities, and any other regulated activity originating in New York and Maine, and regulated electric distribution, electric transmission and gas distribution activities originating in Connecticut and Massachusetts. The Renewables segment owns, develops, constructs and/or operates electricity generation, including renewable and thermal generators, and associated transmission facilities. The Renewables segment includes activities relating to renewable energy, mainly wind energy generation and trading related with such activities. The Gas segment operates a natural gas storage and natural gas trading business through its subsidiaries, Enstor, Inc. and Enstor Energy Services, LLC.

About PPL Corporation

PPL Corporation (PPL) is a utility holding company. Through its subsidiaries, PPL delivers electricity to customers in the United Kingdom, Pennsylvania, Kentucky, Virginia and Tennessee; delivers natural gas to customers in Kentucky, and generates electricity from power plants in Kentucky. PPL operates through U.K. Regulated Segment, Kentucky Regulated Segment and Pennsylvania Regulated Segment. The U.K. Regulated Segment consists of PPL Global, which includes PPL WPD Limited’s (WPD) regulated electricity distribution operations, the results of hedging the translation of WPD’s earnings from British pound sterling into United States dollars, and certain costs, such as the United States income taxes, administrative costs and allocated financing costs. Kentucky Regulated segment consists of the operations of Louisville Gas and Electric Company (LG&E) and KU Energy LLC (LKE). The Pennsylvania Regulated segment consists of PPL Electric Utilities Corporation (PPL Electric).

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