Innergex Renewable Energy (OTCMKTS:INGXF – Get Free Report) and Algonquin Power & Utilities (NYSE:AQN – Get Free Report) are both mid-cap utilities companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, risk, valuation, earnings, institutional ownership, analyst recommendations and profitability.
Profitability
This table compares Innergex Renewable Energy and Algonquin Power & Utilities’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Innergex Renewable Energy | 5.51% | 5.30% | 0.76% |
| Algonquin Power & Utilities | -1.11% | 5.14% | 1.84% |
Insider and Institutional Ownership
62.3% of Algonquin Power & Utilities shares are owned by institutional investors. 4.7% of Innergex Renewable Energy shares are owned by insiders. Comparatively, 0.1% of Algonquin Power & Utilities shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Innergex Renewable Energy | 0 | 2 | 0 | 0 | 2.00 |
| Algonquin Power & Utilities | 1 | 5 | 4 | 2 | 2.58 |
Algonquin Power & Utilities has a consensus price target of $6.67, suggesting a potential downside of 2.03%. Given Algonquin Power & Utilities’ stronger consensus rating and higher probable upside, analysts clearly believe Algonquin Power & Utilities is more favorable than Innergex Renewable Energy.
Valuation and Earnings
This table compares Innergex Renewable Energy and Algonquin Power & Utilities”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Innergex Renewable Energy | $764.31 million | 2.69 | $11.60 million | $0.14 | 72.18 |
| Algonquin Power & Utilities | $2.32 billion | 2.25 | -$1.38 billion | ($0.04) | -170.13 |
Innergex Renewable Energy has higher earnings, but lower revenue than Algonquin Power & Utilities. Algonquin Power & Utilities is trading at a lower price-to-earnings ratio than Innergex Renewable Energy, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Innergex Renewable Energy has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500. Comparatively, Algonquin Power & Utilities has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500.
Dividends
Innergex Renewable Energy pays an annual dividend of $0.26 per share and has a dividend yield of 2.6%. Algonquin Power & Utilities pays an annual dividend of $0.26 per share and has a dividend yield of 3.8%. Innergex Renewable Energy pays out 185.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Algonquin Power & Utilities pays out -650.0% of its earnings in the form of a dividend. Algonquin Power & Utilities is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Algonquin Power & Utilities beats Innergex Renewable Energy on 10 of the 17 factors compared between the two stocks.
About Innergex Renewable Energy
Innergex Renewable Energy Inc. operates as an independent renewable power producer in Canada, the United States, France, and Chile. It acquires, owns, develops, and operates renewable power-generating and energy storage facilities primarily in hydroelectric, wind, and solar power sectors. The company operates through three segments: Hydroelectric Power Generation, Wind Power Generation, and Solar Power Generation. As of February 21, 2024, it owned and operated 87 facilities with a net installed capacity of 3,600 megawatts, including 41 hydroelectric facilities, 35 wind facilities, 9 solar facilities, and 2 battery energy storage facilities. The company is headquartered in Longueuil, Canada.
About Algonquin Power & Utilities
Algonquin Power & Utilities Corp. is an investment holding company, which engages in energy generation and water distribution facilities. It operates through the Regulated Services Group and Renewable Energy Group segments. The Regulated Services Group segment owns and operates a portfolio of electric, natural gas, water distribution, and wastewater collection utility systems and transmission. The Renewable Energy Group segment focuses on operating a diversified portfolio of renewable and thermal electric generation assets. The company was founded on August 1, 1988 and is headquartered in Oakville, Canada.
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