AES (NYSE:AES) vs. Kenon (NYSE:KEN) Financial Comparison

AES (NYSE:AES) and Kenon (NYSE:KEN) are both utilities companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, risk, earnings, dividends and valuation.

Institutional & Insider Ownership

93.1% of AES shares are owned by institutional investors. Comparatively, 13.4% of Kenon shares are owned by institutional investors. 0.8% of AES shares are owned by insiders. Comparatively, 0.1% of Kenon shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares AES and Kenon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AES	13.16%	20.56%	3.73%
Kenon	10.03%	4.46%	2.42%

Dividends

AES pays an annual dividend of $0.70 per share and has a dividend yield of 4.7%. Kenon pays an annual dividend of $3.85 per share and has a dividend yield of 6.7%. AES pays out 28.1% of its earnings in the form of a dividend. Kenon pays out 215.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AES has raised its dividend for 12 consecutive years and Kenon has raised its dividend for 2 consecutive years.

Valuation & Earnings

This table compares AES and Kenon”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AES	$13.57 billion	0.78	$910.00 million	$2.49	5.97
Kenon	$871.63 million	3.43	$66.27 million	$1.79	32.09

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

Analyst Recommendations

This is a breakdown of recent ratings and target prices for AES and Kenon, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AES	0	7	0	0	2.00
Kenon	0	1	0	0	2.00

AES presently has a consensus target price of $15.80, indicating a potential upside of 6.22%. Given AES’s higher possible upside, equities analysts clearly believe AES is more favorable than Kenon.

Volatility & Risk

AES has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, Kenon has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500.

Summary

AES beats Kenon on 11 of the 15 factors compared between the two stocks.

About AES

The AES Corporation, together with its subsidiaries, operates as a diversified power generation and utility company in the United States and internationally. The company owns and/or operates power plants to generate and sell power to customers, such as utilities, industrial users, and other intermediaries; owns and/or operates utilities to generate or purchase, distribute, transmit, and sell electricity to end-user customers in the residential, commercial, industrial, and governmental sectors; and generates and sells electricity on the wholesale market. It uses various fuels and technologies to generate electricity, such as coal, gas, hydro, wind, solar, and biomass, as well as renewables comprising energy storage and landfill gas. The company owns and/or operates a generation portfolio of approximately 34,596 megawatts and distributes power to 2.6 million customers. The company was formerly known as Applied Energy Services, Inc. and changed its name to The AES Corporation in April 2000. The AES Corporation was incorporated in 1981 and is headquartered in Arlington, Virginia.

About Kenon

Kenon Holdings Ltd., through its subsidiaries, operates as an owner, developer, and operator of power generation facilities in Israel, the United States, and internationally. It operates through OPC Power Plants, CPV Group, and ZIM segments. The company engages in the generation and supply of electricity and energy; development, construction, and management of solar and wind energy, and conventional natural gas-fired power plants; and provision of container liner shipping services. It also operates a fleet of 150 vessels. Kenon Holdings Ltd. was incorporated in 2014 and is based in Singapore. Kenon Holdings Ltd. operates as a subsidiary of Ansonia Holdings Singapore B.V.