Comparing Duke Energy (NYSE:DUK) and TXNM Energy (NYSE:TXNM)

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

Dividends

Duke Energy pays an annual dividend of $4.34 per share and has a dividend yield of 3.8%. TXNM Energy pays an annual dividend of $1.69 per share and has a dividend yield of 2.9%. Duke Energy pays out 65.2% of its earnings in the form of a dividend. TXNM Energy pays out 93.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Duke Energy has raised its dividend for 20 consecutive years. Duke Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Duke Energy has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500. Comparatively, TXNM Energy has a beta of 0.17, suggesting that its share price is 83% less volatile than the S&P 500.

Insider and Institutional Ownership

65.3% of Duke Energy shares are held by institutional investors. Comparatively, 91.7% of TXNM Energy shares are held by institutional investors. 0.1% of Duke Energy shares are held by insiders. Comparatively, 1.1% of TXNM Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Duke Energy and TXNM Energy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Duke Energy	$32.24 billion	2.74	$4.97 billion	$6.66	17.03
TXNM Energy	$2.17 billion	2.96	$151.89 million	$1.81	32.19

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Duke Energy and TXNM Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Duke Energy	0	8	10	0	2.56
TXNM Energy	0	3	0	0	2.00

Duke Energy presently has a consensus target price of $137.56, suggesting a potential upside of 21.31%. TXNM Energy has a consensus target price of $61.25, suggesting a potential upside of 5.13%. Given Duke Energy’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Duke Energy is more favorable than TXNM Energy.

Profitability

This table compares Duke Energy and TXNM Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Duke Energy	15.78%	9.78%	2.67%
TXNM Energy	9.04%	8.11%	2.34%

Summary

Duke Energy beats TXNM Energy on 13 of the 17 factors compared between the two stocks.

About Duke Energy

Duke Energy Corporation, together with its subsidiaries, operates as an energy company in the United States. It operates through two segments: Electric Utilities and Infrastructure (EU&I), and Gas Utilities and Infrastructure (GU&I). The EU&I segment generates, transmits, distributes, and sells electricity in the Carolinas, Florida, and the Midwest. It generates electricity through coal, hydroelectric, natural gas, oil, solar and wind sources, renewables, and nuclear fuel. This segment also engages in the wholesale of electricity to municipalities, electric cooperative utilities, and load-serving entities. The GU&I segment distributes natural gas to residential, commercial, industrial, and power generation natural gas customers; and invests in pipeline transmission projects, renewable natural gas projects, and natural gas storage facilities. The company was formerly known as Duke Energy Holding Corp. and changed its name to Duke Energy Corporation in April 2006. Duke Energy Corporation was founded in 1904 and is headquartered in Charlotte, North Carolina.

About TXNM Energy

TXNM Energy, Inc., through its subsidiaries, provides electricity and electric services in the United States. It operates through Public Service Company of New Mexico (PNM) and Texas-New Mexico Power Company (TNMP) segments. The PNM segment engages in the generation, transmission, and distribution of electricity. The segment owns and leases communications, office and other equipment, office space, vehicles, and real estate. It generates electricity using coal, natural gas and oil, and nuclear fuel and waste, as well as solar, wind, geothermal, and battery storage energy sources. The TNMP segment provides regulated transmission and distribution services. The segment also owns and leases vehicles, service facilities, and office locations throughout its service territory. The company serves residential, commercial, and industrial customers and end-users of electricity in New Mexico and Texas. The company was formerly known as PNM Resources, Inc and changed its name to TXNM Energy, Inc. in August 2024. TXNM Energy, Inc. was founded in 1882 and is based in Albuquerque, New Mexico.