Critical Survey: ENN Energy (OTCMKTS:XNGSF) versus NewJersey Resources (NYSE:NJR)

ENN Energy (OTCMKTS:XNGSF) and NewJersey Resources (NYSE:NJR) are both utilities companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, valuation, earnings, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current recommendations for ENN Energy and NewJersey Resources, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ENN Energy	0	0	0	0	0.00
NewJersey Resources	0	1	3	1	3.00

NewJersey Resources has a consensus target price of $57.83, indicating a potential upside of 6.19%. Given NewJersey Resources’ stronger consensus rating and higher possible upside, analysts plainly believe NewJersey Resources is more favorable than ENN Energy.

Dividends

ENN Energy pays an annual dividend of $0.39 per share and has a dividend yield of 6.1%. NewJersey Resources pays an annual dividend of $1.90 per share and has a dividend yield of 3.5%. ENN Energy pays out 25.1% of its earnings in the form of a dividend. NewJersey Resources pays out 52.5% 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. NewJersey Resources has increased its dividend for 29 consecutive years. ENN Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

40.4% of ENN Energy shares are owned by institutional investors. Comparatively, 71.0% of NewJersey Resources shares are owned by institutional investors. 0.7% of NewJersey Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares ENN Energy and NewJersey Resources”s revenue, earnings per share (EPS) 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	4.08
NewJersey Resources	$2.04 billion	2.71	$335.63 million	$3.62	15.04

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

Profitability

This table compares ENN Energy and NewJersey Resources’ 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
NewJersey Resources	16.42%	14.46%	4.67%

Summary

NewJersey Resources beats ENN Energy on 13 of the 15 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 NewJersey Resources

New Jersey Resources Corporation, an energy services holding company, distributes natural gas. The company operates through four segments: Natural Gas Distribution, Clean Energy Ventures, Energy Services, and Storage and Transportation. The Natural Gas Distribution segment offers regulated natural gas utility services to approximately 576,000 customers in Burlington, Middlesex, Monmouth, Morris, Ocean, and Sussex counties in New Jersey; provides capacity and storage management services; and participates in the off-system sales and capacity release markets. The Clean Energy Ventures segment invests in, owns, and operates clean energy projects, including commercial and residential solar installation situated in New Jersey, Rhode Island, New York, Connecticut, Michigan, and Indiana. The Energy Services segment maintains and operates natural gas transportation and storage capacity contracts, as well as provides physical wholesale energy, retail energy and energy management services in the United States and Canada. The Storage and Transportation segment invests in invests in energy-related ventures. It provides heating, ventilation, and cooling services; sales and installation of appliances; offers solar equipment installation, and plumbing repair and installation services; and holds commercial real estate properties. The company was incorporated in 1981 and is headquartered in Wall, New Jersey.