Head to Head Contrast: Southwest Gas (NYSE:SWX) & ENN Energy (OTCMKTS:XNGSF)

ENN Energy (OTCMKTS:XNGSF) and Southwest Gas (NYSE:SWX) are both utilities companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Profitability

This table compares ENN Energy and Southwest Gas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ENN Energy	N/A	N/A	N/A
Southwest Gas	31.85%	6.91%	2.64%

Analyst Recommendations

This is a breakdown of current recommendations for ENN Energy and Southwest Gas, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ENN Energy	0	0	0	0	0.00
Southwest Gas	0	1	6	1	3.00

Southwest Gas has a consensus price target of $98.29, indicating a potential upside of 6.59%. Given Southwest Gas’ stronger consensus rating and higher probable upside, analysts clearly believe Southwest Gas is more favorable than ENN Energy.

Institutional and Insider Ownership

40.4% of ENN Energy shares are owned by institutional investors. Comparatively, 92.8% of Southwest Gas shares are owned by institutional investors. 0.6% of Southwest Gas shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares ENN Energy and Southwest Gas”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ENN Energy	N/A	N/A	N/A	$1.54	4.09
Southwest Gas	$1.94 billion	3.44	$439.83 million	$7.66	12.04

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

Dividends

ENN Energy pays an annual dividend of $0.39 per share and has a dividend yield of 6.1%. Southwest Gas pays an annual dividend of $2.58 per share and has a dividend yield of 2.8%. ENN Energy pays out 25.1% of its earnings in the form of a dividend. Southwest Gas pays out 33.7% 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. ENN Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Southwest Gas beats ENN Energy on 12 of the 14 factors compared between the two stocks.

About ENN Energy

ENN Energy Holdings Limited, an investment holding company, engages in the investment, construction, operation, and management of gas pipeline infrastructure in the People's Republic of China. It operates through Retail Gas Sales Business, Integrated Energy Business, Wholesale of Gas, Construction and Installation, and Value Added Business segments. The company also distributes and sells piped gas, liquefied natural gas (LNG), and other multi-energy products; operates vehicle gas refuelling stations; and provides services related to low-carbon integrated solutions. In addition, it is involved in the integrated energy business; retail of gas pipelines, and related materials and equipment; transportation of oil products and gas; and sourcing and sell of LNG, as well as wholesale and retail of LNG, CNG, gas equipment, appliances, and others; and provision of financial services. The company serves residential, commercial, and industrial customers. ENN Energy Holdings Limited was formerly known as XinAo Gas Holdings Limited and changed its name to ENN Energy Holdings Limited in September 2010. The company was founded in 1989 and is headquartered in Langfang, China.

About Southwest Gas

Southwest Gas Holdings, Inc., through its subsidiaries, distributes and transports natural gas in Arizona, Nevada, and California. The company operates through Natural Gas Distribution, Utility Infrastructure Services, and Pipeline and Storage segments. It also provides trenching, installation, and replacement of underground pipes, as well as maintenance services for energy distribution systems. As of December 31, 2023, it had 2,226,000 residential, commercial, industrial, and other natural gas customers. Southwest Gas Holdings, Inc. was incorporated in 1931 and is headquartered in Las Vegas, Nevada.