Comparing Chesapeake Utilities Corporation (CPK) and South Jersey Industries (SJI)

South Jersey Industries (NYSE: SJI) and Chesapeake Utilities Corporation (NYSE:CPK) are both utilities companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Valuation and Earnings

This table compares South Jersey Industries and Chesapeake Utilities Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
South Jersey Industries $1.22 billion 2.26 $261.72 million $1.07 32.52
Chesapeake Utilities Corporation $560.47 million 2.30 $122.80 million $2.56 30.84

South Jersey Industries has higher revenue and earnings than Chesapeake Utilities Corporation. Chesapeake Utilities Corporation is trading at a lower price-to-earnings ratio than South Jersey Industries, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

South Jersey Industries has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500. Comparatively, Chesapeake Utilities Corporation has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500.

Dividends

South Jersey Industries pays an annual dividend of $1.09 per share and has a dividend yield of 3.1%. Chesapeake Utilities Corporation pays an annual dividend of $1.30 per share and has a dividend yield of 1.6%. South Jersey Industries pays out 101.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chesapeake Utilities Corporation pays out 50.8% of its earnings in the form of a dividend. South Jersey Industries has increased its dividend for 13 consecutive years. South Jersey Industries 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 ratings and recommmendations for South Jersey Industries and Chesapeake Utilities Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
South Jersey Industries 0 3 3 0 2.50
Chesapeake Utilities Corporation 0 4 0 0 2.00

South Jersey Industries currently has a consensus price target of $38.33, indicating a potential upside of 10.15%. Chesapeake Utilities Corporation has a consensus price target of $69.00, indicating a potential downside of 12.60%. Given South Jersey Industries’ stronger consensus rating and higher probable upside, research analysts clearly believe South Jersey Industries is more favorable than Chesapeake Utilities Corporation.

Profitability

This table compares South Jersey Industries and Chesapeake Utilities Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
South Jersey Industries 7.02% 7.71% 2.68%
Chesapeake Utilities Corporation 7.40% 9.18% 3.41%

Insider and Institutional Ownership

69.3% of South Jersey Industries shares are held by institutional investors. Comparatively, 59.7% of Chesapeake Utilities Corporation shares are held by institutional investors. 0.6% of South Jersey Industries shares are held by insiders. Comparatively, 5.4% of Chesapeake Utilities Corporation shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

South Jersey Industries beats Chesapeake Utilities Corporation on 9 of the 17 factors compared between the two stocks.

South Jersey Industries Company Profile

South Jersey Industries, Inc. (SJI) is an energy services holding company. The Company provides a range of energy-related products and services, primarily through its subsidiaries. Its subsidiaries include South Jersey Gas Company (SJG), South Jersey Energy Company (SJE), South Jersey Resources Group, LLC (SJRG), South Jersey Exploration, LLC (SJEX), Marina Energy, LLC (Marina), South Jersey Energy Service Plus, LLC (SJESP) and SJI Midstream, LLC (Midstream). Its segments include Gas utility operations (SJG), which consist primarily of natural gas distribution; Wholesale energy operations, which include the activities of SJRG and SJEX; SJE, which is involved in both retail gas and retail electric activities; On-Site energy production, which consists of Marina’s thermal energy facility; Appliance service operations, which include SJESP, and Corporate and Services segment, which includes the activities of Midstream.

Chesapeake Utilities Corporation Company Profile

Chesapeake Utilities Corporation (Chesapeake) is an energy company. The Company operates through two segments: Regulated Energy and Unregulated Energy. The Company provides natural gas distribution and transmission; natural gas supply, gathering, processing and marketing; electric distribution and generation; propane distribution; propane and crude oil wholesale marketing; steam generation, and other energy-related services. The Regulated Energy segment includes the Company’s natural gas distribution, natural gas transmission and electric distribution operations. The Unregulated Energy segment includes its propane distribution, propane and crude oil wholesale marketing, natural gas marketing and unregulated natural gas supply, gathering and processing, electricity and steam generation and other unregulated energy-related services to customers.

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