Critical Review: Genie Energy (NYSE:GNE) and Eversource Energy (NYSE:ES)

Eversource Energy (NYSE:ES) and Genie Energy (NYSE:GNE) are both utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, earnings, institutional ownership, analyst recommendations, risk and profitability.

Volatility & Risk

Eversource Energy has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, Genie Energy has a beta of 0.19, meaning that its share price is 81% less volatile than the S&P 500.

Institutional & Insider Ownership

80.0% of Eversource Energy shares are held by institutional investors. Comparatively, 49.1% of Genie Energy shares are held by institutional investors. 0.2% of Eversource Energy shares are held by insiders. Comparatively, 18.5% of Genie Energy shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Eversource Energy and Genie Energy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eversource Energy	$13.55 billion	1.91	$1.69 billion	$3.86	17.77
Genie Energy	$501.97 million	0.85	$24.01 million	$0.81	20.10

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

Analyst Recommendations

This is a summary of recent recommendations for Eversource Energy and Genie Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eversource Energy	3	6	4	0	2.08
Genie Energy	0	2	0	0	2.00

Eversource Energy currently has a consensus price target of $72.92, indicating a potential upside of 6.31%. Given Eversource Energy’s stronger consensus rating and higher possible upside, research analysts plainly believe Eversource Energy is more favorable than Genie Energy.

Profitability

This table compares Eversource Energy and Genie Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eversource Energy	10.35%	11.33%	2.91%
Genie Energy	5.05%	12.80%	7.82%

Dividends

Eversource Energy pays an annual dividend of $3.15 per share and has a dividend yield of 4.6%. Genie Energy pays an annual dividend of $0.30 per share and has a dividend yield of 1.8%. Eversource Energy pays out 81.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Genie Energy pays out 37.0% of its earnings in the form of a dividend. Eversource Energy has raised its dividend for 2 consecutive years. Eversource Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Eversource Energy beats Genie Energy on 12 of the 17 factors compared between the two stocks.

About Eversource Energy

Eversource Energy, a public utility holding company, engages in the energy delivery business. The company operates through Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution segments. It is involved in the transmission and distribution of electricity; solar power facilities; and distribution of natural gas. The company operates regulated water utilities that provide water services to approximately 241,000 customers. It serves residential, commercial, industrial, municipal and fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. Eversource Energy was incorporated in 1927 and is headquartered in Springfield, Massachusetts.

About Genie Energy

Genie Energy Ltd., through its subsidiaries, engages in the supply of electricity and natural gas to residential and small business customers in the United States and internationally. It operates in two segments, GRE and Genie Renewables. The company also develops, constructs, and operates solar energy projects for commercial and industrial customers, as well as its own portfolio; provides energy brokerage and advisory services; markets community solar energy solutions; and manufactures and distributes solar panel, as well as engages in solar installation design and project management activities. Genie Energy Ltd. was incorporated in 2011 and is headquartered in Newark, New Jersey.