Southern Company (The) (SO) and Empresa Nacional de Electricidad (EOCC) Financial Contrast

Southern Company (The) (NYSE: SO) and Empresa Nacional de Electricidad (NYSE:EOCC) are both mid-cap utilities companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Volatility & Risk

Southern Company (The) has a beta of 0.15, indicating that its share price is 85% less volatile than the S&P 500. Comparatively, Empresa Nacional de Electricidad has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500.

Valuation and Earnings

This table compares Southern Company (The) and Empresa Nacional de Electricidad’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Southern Company (The) $22.65 billion 2.30 $5.63 billion $0.67 77.91
Empresa Nacional de Electricidad $2.51 billion 2.82 $882.60 million N/A N/A

Southern Company (The) has higher revenue and earnings than Empresa Nacional de Electricidad.

Analyst Ratings

This is a breakdown of current recommendations for Southern Company (The) and Empresa Nacional de Electricidad, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Southern Company (The) 3 5 8 0 2.31
Empresa Nacional de Electricidad 2 0 0 0 1.00

Southern Company (The) currently has a consensus target price of $49.27, suggesting a potential downside of 5.61%. Empresa Nacional de Electricidad has a consensus target price of $24.20, suggesting a potential downside of 6.56%. Given Southern Company (The)’s stronger consensus rating and higher possible upside, research analysts plainly believe Southern Company (The) is more favorable than Empresa Nacional de Electricidad.

Profitability

This table compares Southern Company (The) and Empresa Nacional de Electricidad’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Southern Company (The) 2.93% 11.30% 2.64%
Empresa Nacional de Electricidad N/A N/A N/A

Dividends

Southern Company (The) pays an annual dividend of $2.32 per share and has a dividend yield of 4.4%. Empresa Nacional de Electricidad pays an annual dividend of $1.14 per share and has a dividend yield of 4.4%. Southern Company (The) pays out 346.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Southern Company (The) has raised its dividend for 15 consecutive years. Southern Company (The) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

53.1% of Southern Company (The) shares are owned by institutional investors. Comparatively, 2.6% of Empresa Nacional de Electricidad shares are owned by institutional investors. 1.0% of Southern Company (The) shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Southern Company (The) beats Empresa Nacional de Electricidad on 12 of the 15 factors compared between the two stocks.

Southern Company (The) Company Profile

The Southern Company (Southern Company) is a holding company. The Company owns all of the stock of the traditional electric operating companies and the parent entities of Southern Power Company (Southern Power) and Southern Company Gas, and owns other direct and indirect subsidiaries. The Company’s segments include Gas distribution operations, Gas marketing services, Wholesale gas services, Gas midstream operations and All other. The Gas distribution operations segment includes natural gas local distribution utilities that construct, manage, and maintain intrastate natural gas pipelines and gas distribution facilities in seven states. The Gas marketing services segment provides natural gas commodity and related services to customers markets that provide for customer choice. The Wholesale gas services segment engages in natural gas storage and gas pipeline arbitrage. The Gas midstream operations consist primarily of gas pipeline investments, with storage and fuels.

Empresa Nacional de Electricidad Company Profile

Enel Generacion Chile SA, formerly Empresa Nacional De Electricidad SA, is a Chile-based company engaged in the business of electricity generation. The Company operates in Chile. The Company owns and operates a total of approximately 111-generation units in Chile both directly and through its subsidiaries, Pehuenche, Celta and GasAtacama. Of these generation units, approximately 38 are hydroelectric, with a total installed capacity of over 3,470 megawatts. There are approximately 22 thermal generation units that operate with gas, coal or oil with a total installed capacity of over 2,808 megawatts. There are over 51 wind powered generation units with an aggregate installed capacity of approximately 78 megawatts. The Company’s subsidiaries include Compania Electrica San Isidro S.A. (San Isidro), Compania Electrica Tarapaca S.A. (Celta), Empresa Electrica Pehuenche S.A. (Pehuenche) and GasAtacama S.A (GasAtacama). It is controlled by Enel Chile SA.

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