Critical Contrast: Pacific Gas & Electric Co. (PCG) and The Competition

Pacific Gas & Electric Co. (NYSE: PCG) is one of 87 publicly-traded companies in the “Electric Utilities” industry, but how does it compare to its competitors? We will compare Pacific Gas & Electric Co. to related companies based on the strength of its risk, earnings, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Profitability

This table compares Pacific Gas & Electric Co. and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pacific Gas & Electric Co. 12.59% 12.06% 3.23%
Pacific Gas & Electric Co. Competitors -10.85% 3.40% 0.48%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Pacific Gas & Electric Co. and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pacific Gas & Electric Co. 0 4 9 0 2.69
Pacific Gas & Electric Co. Competitors 530 2941 2359 41 2.33

Pacific Gas & Electric Co. presently has a consensus target price of $68.17, suggesting a potential upside of 20.01%. As a group, “Electric Utilities” companies have a potential upside of 6.39%. Given Pacific Gas & Electric Co.’s stronger consensus rating and higher possible upside, analysts plainly believe Pacific Gas & Electric Co. is more favorable than its competitors.

Dividends

Pacific Gas & Electric Co. pays an annual dividend of $2.12 per share and has a dividend yield of 3.7%. Pacific Gas & Electric Co. pays out 48.7% of its earnings in the form of a dividend. As a group, “Electric Utilities” companies pay a dividend yield of 3.2% and pay out 108.1% of their earnings in the form of a dividend. Pacific Gas & Electric Co. is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

81.1% of Pacific Gas & Electric Co. shares are owned by institutional investors. Comparatively, 65.5% of shares of all “Electric Utilities” companies are owned by institutional investors. 0.2% of Pacific Gas & Electric Co. shares are owned by insiders. Comparatively, 2.7% of shares of all “Electric Utilities” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Pacific Gas & Electric Co. and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Pacific Gas & Electric Co. $17.67 billion $1.41 billion 13.06
Pacific Gas & Electric Co. Competitors $7.66 billion $831.80 million 52.60

Pacific Gas & Electric Co. has higher revenue and earnings than its competitors. Pacific Gas & Electric Co. is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Volatility and Risk

Pacific Gas & Electric Co. has a beta of 0.17, meaning that its stock price is 83% less volatile than the S&P 500. Comparatively, Pacific Gas & Electric Co.’s competitors have a beta of 0.65, meaning that their average stock price is 35% less volatile than the S&P 500.

Summary

Pacific Gas & Electric Co. beats its competitors on 11 of the 15 factors compared.

About Pacific Gas & Electric Co.

PG&E Corporation is a holding company. The Company’s primary operating subsidiary is Pacific Gas and Electric Company (the Utility), which operates in northern and central California. The Utility is engaged in the sale and delivery of electricity and natural gas to customers. The Utility generates electricity and provides electricity transmission and distribution services throughout its service territory in northern and central California to residential, commercial, industrial, and agricultural customers. The Utility provides bundled services (electricity, transmission and distribution services) to various customers in its service territory. As of December 31, 2016, the Utility owned approximately 18,400 circuit miles of interconnected transmission lines operating at voltages ranging from 60 kilovolt to 500 kilovolt. As of December 31, 2016, the Utility also operated 92 electric transmission substations with a capacity of approximately 64,600 megavolt ampere (MVA).

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