Critical Survey: IDACORP (NYSE:IDA) and NiSource (NYSE:NI)

IDACORP (NYSE:IDA) and NiSource (NYSE:NI) are both utilities companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Institutional & Insider Ownership

89.1% of IDACORP shares are held by institutional investors. Comparatively, 91.6% of NiSource shares are held by institutional investors. 0.5% of IDACORP shares are held by insiders. Comparatively, 0.2% of NiSource shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

IDACORP has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, NiSource has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Dividends

IDACORP pays an annual dividend of $3.52 per share and has a dividend yield of 2.5%. NiSource pays an annual dividend of $1.20 per share and has a dividend yield of 2.6%. IDACORP pays out 60.5% of its earnings in the form of a dividend. NiSource pays out 61.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. IDACORP has increased its dividend for 13 consecutive years and NiSource has increased its dividend for 14 consecutive years. NiSource is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations for IDACORP and NiSource, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IDACORP	1	1	8	0	2.70
NiSource	0	3	9	0	2.75

IDACORP presently has a consensus target price of $137.67, indicating a potential downside of 2.69%. NiSource has a consensus target price of $47.20, indicating a potential upside of 4.14%. Given NiSource’s stronger consensus rating and higher probable upside, analysts clearly believe NiSource is more favorable than IDACORP.

Profitability

This table compares IDACORP and NiSource’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IDACORP	17.59%	9.35%	3.27%
NiSource	13.99%	8.07%	2.64%

Valuation and Earnings

This table compares IDACORP and NiSource”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IDACORP	$1.83 billion	4.19	$289.17 million	$5.82	24.31
NiSource	$6.64 billion	3.27	$929.50 million	$1.95	23.24

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

Summary

NiSource beats IDACORP on 9 of the 17 factors compared between the two stocks.

About IDACORP

IDACORP, Inc., together with its subsidiaries, engages in the generation, transmission, distribution, purchase, and sale of electric energy in the United States. The company operates 17 hydropower generating plants located in southern Idaho and eastern Oregon; three natural gas-fired plants in southern Idaho; and interests in two coal-fired steam electric generating plants located in Wyoming and Nevada. As of December 31, 2023, it had approximately 4,762 pole-miles of high-voltage transmission lines; 23 step-up transmission substations located at power plants; 21 transmission substations; 11 switching stations; 30 mixed-use transmission and distribution substations; 186 energized distribution substations; and 29,714 pole-miles of distribution lines, and 131 MW of battery storage, as well as provides electric utility services to approximately 633,000 retail customers in southern Idaho and eastern Oregon. The company serves commercial and industrial customers, which involved in food processing, electronics and general manufacturing, agriculture, health care, government, and education. It also invests in housing and other real estate tax credit investments. IDACORP, Inc. was founded in 1915 and is headquartered in Boise, Idaho.

About NiSource

NiSource Inc., an energy holding company, operates as a regulated natural gas and electric utility company in the United States. It operates in two segments, Gas Distribution Operations and Electric Operations. The company distributes natural gas to approximately 3.3 million customers through approximately 55,000 miles of distribution main pipeline and the associated individual customer service lines; and 1,000 miles of transmission main pipeline in northern Indiana, Ohio, Pennsylvania, Virginia, Kentucky, and Maryland. It also generates, transmits, and distributes electricity to approximately 0.5 million customers in various counties in the northern part of Indiana, as well as engages in wholesale electric and transmission transactions. It owns and operates coal-fired electric generating stations in Wheatfield and Michigan City; combined cycle gas turbine in West Terre Haute; natural gas generating units in Wheatfield; hydro generating plants in Carroll County and White County; wind generating units in White County, Indiana; and solar generating units in Jasper County and White County. The company was formerly known as NIPSCO Industries, Inc. and changed its name to NiSource Inc. in April 1999. NiSource Inc. was founded in 1847 and is headquartered in Merrillville, Indiana.