PPL (NYSE:PPL – Get Free Report) and MGE Energy (NASDAQ:MGEE – Get Free Report) are both utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, valuation, earnings, institutional ownership, analyst recommendations and dividends.
Profitability
This table compares PPL and MGE Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| PPL | 11.22% | 8.81% | 3.02% |
| MGE Energy | 18.24% | 10.58% | 4.65% |
Analyst Recommendations
This is a breakdown of recent ratings and price targets for PPL and MGE Energy, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| PPL | 0 | 1 | 6 | 2 | 3.11 |
| MGE Energy | 1 | 1 | 0 | 0 | 1.50 |
Insider & Institutional Ownership
77.0% of PPL shares are held by institutional investors. Comparatively, 52.6% of MGE Energy shares are held by institutional investors. 0.2% of PPL shares are held by company insiders. Comparatively, 0.2% of MGE Energy shares are held by company 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.
Valuation and Earnings
This table compares PPL and MGE Energy”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| PPL | $8.46 billion | 3.25 | $888.00 million | $1.34 | 27.75 |
| MGE Energy | $676.94 million | 4.54 | $120.57 million | $3.60 | 23.38 |
PPL has higher revenue and earnings than MGE Energy. MGE Energy is trading at a lower price-to-earnings ratio than PPL, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
PPL has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, MGE Energy has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.
Dividends
PPL pays an annual dividend of $1.09 per share and has a dividend yield of 2.9%. MGE Energy pays an annual dividend of $1.90 per share and has a dividend yield of 2.3%. PPL pays out 81.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MGE Energy pays out 52.8% of its earnings in the form of a dividend. PPL has increased its dividend for 3 consecutive years and MGE Energy has increased its dividend for 49 consecutive years.
Summary
PPL beats MGE Energy on 10 of the 18 factors compared between the two stocks.
About PPL
PPL Corporation, an energy company, focuses on providing electricity and natural gas to approximately 3.6 million customers in the United States. It operates through three segments: Kentucky Regulated, Pennsylvania Regulated, and Rhode Island Regulated. The company delivers electricity to customers in Pennsylvania, Kentucky, Virginia, and Rhode Island; delivers natural gas to customers in Kentucky and Rhode Island; and generates electricity from power plants in Kentucky. PPL Corporation was founded in 1920 and is headquartered in Allentown, Pennsylvania.
About MGE Energy
MGE Energy, Inc., through its subsidiaries, operates as a public utility holding company primarily in the United States. It operates through Regulated Electric Utility Operations; Regulated Gas Utility Operations; Nonregulated Energy Operations; Transmission Investments; and All Other segments. The company generates, purchases, and distributes electricity and natural gas in Wisconsin and Iowa; owns and leases electric generating capacity; and plans, constructs, operates, maintains, and expands transmission facilities to provide transmission power services. It generates electricity from coal-fired, gas-fired, and renewable energy sources. As of December 31, 2023, the company owned and operated 835 miles of overhead electric distribution lines; 1,330 miles of underground electric distribution cables; 49 substations with an installed capacity of 1.2 million kVA; and gas facilities, including 3,066 miles of distribution mains, as well as supplied electric service to approximately 163,000 customers. MGE Energy, Inc. founded in 2001 and is headquartered in Madison, Wisconsin.
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