Financial Comparison: CMS Energy Corporation (CMS) & Empire District Electric (EDE)
CMS Energy Corporation (NYSE: CMS) and Empire District Electric (NYSE:EDE) are both utilities companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.
Volatility & Risk
CMS Energy Corporation has a beta of 0.16, indicating that its stock price is 84% less volatile than the S&P 500. Comparatively, Empire District Electric has a beta of 0.11, indicating that its stock price is 89% less volatile than the S&P 500.
CMS Energy Corporation pays an annual dividend of $1.33 per share and has a dividend yield of 2.9%. Empire District Electric pays an annual dividend of $1.04 per share and has a dividend yield of 3.1%. CMS Energy Corporation pays out 66.8% of its earnings in the form of a dividend. Empire District Electric pays out 75.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Empire District Electric has raised its dividend for 5 consecutive years. Empire District Electric is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation and Earnings
This table compares CMS Energy Corporation and Empire District Electric’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|CMS Energy Corporation||$6.51 billion||2.01||$2.06 billion||$1.99||23.33|
|Empire District Electric||N/A||N/A||N/A||$1.38||24.70|
CMS Energy Corporation has higher revenue and earnings than Empire District Electric. CMS Energy Corporation is trading at a lower price-to-earnings ratio than Empire District Electric, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and recommmendations for CMS Energy Corporation and Empire District Electric, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|CMS Energy Corporation||0||4||5||0||2.56|
|Empire District Electric||2||1||0||0||1.33|
CMS Energy Corporation presently has a consensus target price of $48.75, suggesting a potential upside of 5.02%. Empire District Electric has a consensus target price of $18.33, suggesting a potential downside of 46.22%. Given CMS Energy Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe CMS Energy Corporation is more favorable than Empire District Electric.
Institutional & Insider Ownership
87.4% of CMS Energy Corporation shares are held by institutional investors. Comparatively, 65.9% of Empire District Electric shares are held by institutional investors. 0.7% of CMS Energy Corporation shares are held by insiders. Comparatively, 0.7% of Empire District Electric shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This table compares CMS Energy Corporation and Empire District Electric’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|CMS Energy Corporation||8.52%||12.98%||2.64%|
|Empire District Electric||15.69%||13.50%||4.46%|
CMS Energy Corporation beats Empire District Electric on 8 of the 14 factors compared between the two stocks.
CMS Energy Corporation Company Profile
CMS Energy Corporation is an energy company operating primarily in Michigan. The Company operates through three segments: electric utility, which consists of regulated activities associated with the generation, transmission and distribution of electricity in Michigan; gas utility, which consists of regulated activities associated with the transportation, storage and distribution of natural gas in Michigan, and enterprises, which consists of various subsidiaries engaging primarily in domestic independent power production. The Company is the parent holding company of various subsidiaries, including Consumers Energy Company (Consumers), an electric and gas utility company, and CMS Enterprises Company (CMS Enterprises), a domestic independent power producer. Consumers serves individuals and businesses operating in the alternative energy, automotive, chemical, metal, and food products industries, as well as a group of other industries.
Empire District Electric Company Profile
The Empire District Electric Company is a regulated utility company. The Company is engaged in the generation, purchase, transmission, distribution and sale of electricity. It provides services with in Missouri, Kansas, Oklahoma and Arkansas. The Company operates its businesses in three segments: electric, gas and other. As part of its electric segment, the Company provides water service to over three towns in Missouri. The Company through its subsidiary, The Empire District Gas Company (EDG), is engaged in the distribution of natural gas in Missouri. The Company’s other segment consists of fiber optics business. It supplies electric service at retail to approximately 120 incorporated communities and to various unincorporated areas, and at wholesale to over four municipally owned distribution systems. Its gas operations serve customers in northwest, north central and west central Missouri. It serves a group of customers, including residential, commercial and industrial customers.
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