Critical Contrast: ENGIE (OTCMKTS:ENGIY) versus Edison International (NYSE:EIX)

ENGIE (OTCMKTS:ENGIY) and Edison International (NYSE:EIX) are both large-cap utilities companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Analyst Recommendations

This is a summary of recent ratings for ENGIE and Edison International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ENGIE	0	3	4	2	2.89
Edison International	3	5	4	0	2.08

Edison International has a consensus target price of $72.64, suggesting a potential upside of 1.21%. Given Edison International’s higher possible upside, analysts plainly believe Edison International is more favorable than ENGIE.

Insider & Institutional Ownership

89.0% of Edison International shares are owned by institutional investors. 1.2% of Edison International shares are owned by company 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.

Profitability

This table compares ENGIE and Edison International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ENGIE	N/A	N/A	N/A
Edison International	19.27%	14.56%	2.87%

Volatility and Risk

ENGIE has a beta of 0.48, meaning that its share price is 52% less volatile than the S&P 500. Comparatively, Edison International has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Dividends

ENGIE pays an annual dividend of $0.88 per share and has a dividend yield of 2.9%. Edison International pays an annual dividend of $3.51 per share and has a dividend yield of 4.9%. Edison International pays out 38.1% of its earnings in the form of a dividend. Edison International has raised its dividend for 23 consecutive years. Edison International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares ENGIE and Edison International”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ENGIE	$81.38 billion	0.96	$4.33 billion	N/A	N/A
Edison International	$19.32 billion	1.43	$4.70 billion	$9.21	7.79

Edison International has lower revenue, but higher earnings than ENGIE.

Summary

Edison International beats ENGIE on 11 of the 15 factors compared between the two stocks.

About ENGIE

ENGIE SA engages in the power, natural gas, and energy services businesses. It operates through Renewables, Networks, Energy Solutions, FlexGen, Retail, Nuclear, and Others segments. The Renewables segment comprises renewable energy generation activities, including financing, construction, operation, and maintenance of renewable energy facilities using various energy sources, such as hydroelectric, onshore wind, photovoltaic solar, offshore wind, and geothermal. The Networks segment comprises the electricity and gas infrastructure activities and projects, including the management and development of gas and electricity transportation networks and natural gas distribution networks in and outside of Europe, natural gas underground storage in Europe, and regasification infrastructure in France and Chile. The Energy Solutions encompasses the construction and management of decentralized energy networks to produce energy and related services. The FlexGen segment operates flexible thermal generation and electricity, pumping, and battery storage facilities; solutions for decarbonizing industry with low-carbon hydrogen; and financing, construction, and operation of desalination plants. The Retail segment engages in the sale of gas and electricity to professional, individual, and residential clients. The Nuclear segment engages in the nuclear power generation activities. The others segment sells energy to companies and offers energy management services and solutions. The company was formerly known as GDF SUEZ S.A. and changed its name to ENGIE SA in April 2015. The company was founded in 1880 and is headquartered in Courbevoie, France.

About Edison International

Edison International, through its subsidiaries, engages in the generation and distribution of electric power. The company supplies and delivers electricity to approximately 50,000 square mile area of southern California to residential, commercial, industrial, public authorities, agricultural, and other sectors. Its transmission facilities consist of lines ranging from 55 kV to 500 kV and approximately 80 transmission substations; distribution system consists of approximately 38,000 circuit-miles of overhead lines; approximately 31,000 circuit-miles of underground lines; and 730 distribution substations. The company was founded in 1886 and is based in Rosemead, California.