Financial Analysis: Duke Energy (NYSE:DUK) versus Korea Electric Power (NYSE:KEP)

Korea Electric Power (NYSE:KEP) and Duke Energy (NYSE:DUK) are both large-cap utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, dividends, analyst recommendations, profitability, risk, institutional ownership and valuation.

Insider & Institutional Ownership

65.3% of Duke Energy shares are owned by institutional investors. 1.0% of Korea Electric Power shares are owned by insiders. Comparatively, 0.1% of Duke Energy 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.

Dividends

Korea Electric Power pays an annual dividend of $0.05 per share and has a dividend yield of 0.3%. Duke Energy pays an annual dividend of $4.26 per share and has a dividend yield of 3.6%. Korea Electric Power pays out 1.1% of its earnings in the form of a dividend. Duke Energy pays out 67.0% 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. 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.

Risk and Volatility

Korea Electric Power has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500. Comparatively, Duke Energy has a beta of 0.49, meaning that its stock price is 51% less volatile than the S&P 500.

Valuation & Earnings

This table compares Korea Electric Power and Duke Energy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Korea Electric Power	$68.46 billion	0.32	$2.44 billion	$4.56	3.74
Duke Energy	$30.36 billion	3.00	$4.52 billion	$6.36	18.43

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Korea Electric Power	8.47%	19.00%	3.34%
Duke Energy	15.76%	9.98%	2.69%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Korea Electric Power and Duke Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Korea Electric Power	0	1	1	0	2.50
Duke Energy	1	6	11	1	2.63

Duke Energy has a consensus target price of $136.50, indicating a potential upside of 16.45%. Given Duke Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Duke Energy is more favorable than Korea Electric Power.

Summary

Duke Energy beats Korea Electric Power on 12 of the 18 factors compared between the two stocks.

About Korea Electric Power

Korea Electric Power Corporation, an integrated electric utility company, engages in the generation, transmission, and distribution of electricity in South Korea and internationally. The company operates through Transmission and Distribution, Nuclear Power Generation, Thermal Power Generation, and Others segments. It generates power from nuclear, coal, oil, liquefied natural gas, internal combustion, combined-cycle, integrated gasification combined cycle, hydro, wind, solar, fuel cell, biogas, and other sources. As of December 31, 2022, the company had a total of 770 generation units, including nuclear, thermal, hydroelectric, and internal combustion units with an installed generation capacity of 82,723 megawatts; transmission system consisted of 35,451 circuit kilometers of lines of 765 kilovolts and others, including high-voltage direct current lines, as well as 895 substations with an installed transformer capacity of 347,426 megavolt-amperes; and distribution system included 139,265 megavolt-amperes of transformer capacity and 10,084,051 units of support with a total line length of 535,241 circuit kilometers. The company provides electricity to residential, commercial, educational, industrial, agricultural, street lighting, and overnight power usage. It also provides engineering and construction services for utility plant and others; utility plant maintenance, electric power information technology, resources development, facility maintenance, electric meter reading, and security services; and engages in nuclear fuel, fly ashes recycling, utility plants construction and operation, and wood pellet utilization businesses. Korea Electric Power Corporation was founded in 1898 and is headquartered in Naju-si, South Korea.

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.