Chesapeake Utilities (NYSE:CPK) vs. APA Group (OTCMKTS:APAJF) Critical Analysis

Chesapeake Utilities (NYSE:CPK) and APA Group (OTCMKTS:APAJF) are both utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.

Profitability

This table compares Chesapeake Utilities and APA Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chesapeake Utilities	15.12%	9.34%	3.73%
APA Group	N/A	N/A	N/A

Institutional and Insider Ownership

83.1% of Chesapeake Utilities shares are owned by institutional investors. Comparatively, 20.7% of APA Group shares are owned by institutional investors. 1.4% of Chesapeake Utilities shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings for Chesapeake Utilities and APA Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chesapeake Utilities	0	3	1	0	2.25
APA Group	0	1	0	0	2.00

Chesapeake Utilities presently has a consensus price target of $137.00, indicating a potential upside of 3.03%. APA Group has a consensus price target of $9.00, indicating a potential upside of 26.23%. Given APA Group’s higher probable upside, analysts clearly believe APA Group is more favorable than Chesapeake Utilities.

Valuation and Earnings

This table compares Chesapeake Utilities and APA Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chesapeake Utilities	$930.00 million	3.45	$140.30 million	$6.27	21.21
APA Group	N/A	N/A	N/A	$0.39	18.13

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

Dividends

Chesapeake Utilities pays an annual dividend of $2.94 per share and has a dividend yield of 2.2%. APA Group pays an annual dividend of $0.28 per share and has a dividend yield of 4.0%. Chesapeake Utilities pays out 46.9% of its earnings in the form of a dividend. APA Group pays out 72.4% 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. Chesapeake Utilities has raised its dividend for 22 consecutive years.

Summary

Chesapeake Utilities beats APA Group on 12 of the 14 factors compared between the two stocks.

About Chesapeake Utilities

Chesapeake Utilities Corporation operates as an energy delivery company. The company operates through two segments, Regulated Energy and Unregulated Energy. The Regulated Energy segment natural gas distribution operations in central and southern Delaware, Maryland's eastern shore, and Florida; regulated natural gas transmission in the Delmarva Peninsula, Ohio, and Florida; and regulated electric distribution in northeast and northwest Florida. The Unregulated Energy segment engages in the propane operations in the Mid-Atlantic region, North Carolina, South Carolina, and Florida; unregulated natural gas transmission/supply operation in central and eastern Ohio; generation of electricity and steam; provision of compressed natural gas, liquefied natural gas, and renewable natural gas transportation and pipeline solutions primarily to utilities and pipelines in the United States; and sustainable energy investments. This segment is also involved in the provision of other unregulated services, such as energy-related merchandise sale and heating, ventilation and air conditioning, and plumbing and electrical services. Chesapeake Utilities Corporation was founded in 1859 and is headquartered in Dover, Delaware.

About APA Group

APA Group engages in the energy infrastructure business in Australia. The company operates through Energy Infrastructure, Asset Management, and Energy Investments segments. It operates gas transmission pipelines and interconnected grids, gas-fired power stations, electricity transmission interconnectors, solar and wind farms, and battery energy storage systems, as well as gas storage, processing, and compression facilities. The company also has interests in approximately 15,000 kilometers of gas transmission pipelines; approximately 29,500 kilometers of gas mains and pipelines; and 1.5 million gas consumer connections. It also provides asset management and operating services to its energy investments and third parties; and invests in energy infrastructure. The company is headquartered in Sydney, Australia.