Financial Survey: Centrica (OTCMKTS:CPYYY) & ONE Gas (NYSE:OGS)

Centrica (OTCMKTS:CPYYY) and ONE Gas (NYSE:OGS) are both utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, risk, institutional ownership, valuation, dividends and earnings.

Volatility & Risk

Centrica has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, ONE Gas has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500.

Insider & Institutional Ownership

88.7% of ONE Gas shares are owned by institutional investors. 1.4% of ONE Gas shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Centrica pays an annual dividend of $0.30 per share and has a dividend yield of 3.4%. ONE Gas pays an annual dividend of $2.68 per share and has a dividend yield of 3.6%. ONE Gas pays out 64.0% of its earnings in the form of a dividend. ONE Gas has increased its dividend for 2 consecutive years. ONE Gas is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent recommendations for Centrica and ONE Gas, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Centrica	0	2	1	0	2.33
ONE Gas	0	3	4	0	2.57

ONE Gas has a consensus price target of $77.64, indicating a potential upside of 3.06%. Given ONE Gas’ stronger consensus rating and higher probable upside, analysts plainly believe ONE Gas is more favorable than Centrica.

Profitability

This table compares Centrica and ONE Gas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Centrica	N/A	N/A	N/A
ONE Gas	10.63%	8.07%	2.99%

Valuation and Earnings

This table compares Centrica and ONE Gas”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Centrica	$21.55 billion	0.50	$1.70 billion	N/A	N/A
ONE Gas	$2.08 billion	2.17	$222.85 million	$4.19	17.98

Centrica has higher revenue and earnings than ONE Gas.

Summary

ONE Gas beats Centrica on 11 of the 15 factors compared between the two stocks.

About Centrica

Centrica plc operates as an integrated energy company in the United Kingdom, Ireland, Scandinavia, North America, and internationally. The company operates through British Gas Services & Solutions, British Gas Energy, Centrica Business Solutions, Bord Gáis Energy, Centrica Energy, and Upstream segments. It supplies gas and electricity to residential, commercial, industrial customers, and small businesses, as well as offers energy-related services; and generates power from nuclear assets. The company also provides installation, repair, and maintenance services for central heating, ventilation, and air conditioning systems, as well as offers breakdown services. In addition, it is involved in the procurement, trading, and optimization of energy; procurement and sale of LNG; development and operation of large-scale power assets; building of solar farm and connecting to grid; and supply of energy efficiency solutions and technologies. Further, the company produces and processes gas and oil; constructs, owns, and exploits infrastructure; offers central heating, boiler and controls, plumbing and drains, and electrical appliance insurance covers; and engages in the social enterprise investment fund activities. Additionally, it provides metering assets and services, vehicle leasing, and energy management products and services; constructs battery storage and gas peakers; and operates a gas storage and franchise network. The company was formerly known as Yieldtop plc and changed its name to Centrica plc in December 1996. Centrica plc was founded in 1812 and is based in Windsor, the United Kingdom.

About ONE Gas

ONE Gas, Inc., together with its subsidiaries, operates as a regulated natural gas distribution company in the United States. The company provides natural gas distribution services to approximately 2.3 million customers in Oklahoma, Kansas, and Texas. It serves residential, commercial, and transportation customers. The company was founded in 1906 and is headquartered in Tulsa, Oklahoma.