Critical Review: Exelon (EXC) & NRG Yield, Inc. Class C (NYLD)

Exelon (NYSE: EXC) and NRG Yield, Inc. Class C (NYSE:NYLD) are both utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, risk, earnings, profitability, valuation and analyst recommendations.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Exelon and NRG Yield, Inc. Class C, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Exelon 2 3 11 0 2.56
NRG Yield, Inc. Class C 0 5 4 0 2.44

Exelon currently has a consensus price target of $40.75, indicating a potential upside of 6.09%. NRG Yield, Inc. Class C has a consensus price target of $19.57, indicating a potential upside of 4.10%. Given Exelon’s stronger consensus rating and higher possible upside, research analysts clearly believe Exelon is more favorable than NRG Yield, Inc. Class C.

Profitability

This table compares Exelon and NRG Yield, Inc. Class C’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Exelon 6.59% 8.19% 2.02%
NRG Yield, Inc. Class C 4.10% 1.76% 0.48%

Dividends

Exelon pays an annual dividend of $1.31 per share and has a dividend yield of 3.4%. NRG Yield, Inc. Class C pays an annual dividend of $1.15 per share and has a dividend yield of 6.1%. Exelon pays out 58.7% of its earnings in the form of a dividend. NRG Yield, Inc. Class C pays out 230.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NRG Yield, Inc. Class C has raised its dividend for 2 consecutive years. NRG Yield, Inc. Class C is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Exelon and NRG Yield, Inc. Class C’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Exelon $31.36 billion 1.18 $1.13 billion $2.23 17.22
NRG Yield, Inc. Class C $1.02 billion 3.40 $67.00 million $0.50 37.60

Exelon has higher revenue and earnings than NRG Yield, Inc. Class C. Exelon is trading at a lower price-to-earnings ratio than NRG Yield, Inc. Class C, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

77.3% of Exelon shares are owned by institutional investors. Comparatively, 29.6% of NRG Yield, Inc. Class C shares are owned by institutional investors. 0.7% of Exelon shares are owned by company insiders. Comparatively, 0.2% of NRG Yield, Inc. Class C shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Exelon beats NRG Yield, Inc. Class C on 12 of the 16 factors compared between the two stocks.

Exelon Company Profile

Exelon Corporation is a utility services holding company. The Company, through its subsidiary, Exelon Generation Company, LLC (Generation), is engaged in the energy generation business. The Company, through its subsidiaries, Commonwealth Edison Company (ComEd), PECO Energy Company (PECO), Baltimore Gas and Electric Company (BGE), Pepco Holdings LLC (PHI), Potomac Electric Power Company (Pepco), Delmarva Power & Light Company (DPL) and Atlantic City Electric Company (ACE), is engaged in the energy delivery businesses. It operates through 12 segments: Generation’s six segments: Mid-Atlantic, Midwest, New England, New York, ERCOT and Other Power Regions; ComEd; PECO; BGE, and PHI’s three utility segments: Pepco, DPL and ACE. Generation’s integrated business consists of the generation, physical delivery and marketing of power across geographical regions through its customer-facing business, Constellation, which sells electricity and natural gas to both wholesale and retail customers.

NRG Yield, Inc. Class C Company Profile

NRG Yield, Inc. serves as the primary vehicle, through which NRG Energy, Inc. owns, operates and acquires contracted renewable and conventional generation and thermal infrastructure assets. It owns a diversified portfolio of contracted renewable and conventional generation and thermal infrastructure assets in the United States. Its contracted generation portfolio includes three natural gas or dual-fired facilities, eight utility-scale solar and wind generation facilities and two portfolios of distributed solar facilities that collectively represent 1,324 net megawatt. The Company also own thermal infrastructure assets with an aggregate steam and chilled water capacity of 1,098 net megawatt and electric generation capacity of 123 net megawatt. In July 2014, NRG Yield Inc completed its acquisition of three Right of First Offer (ROFO) assets from NRG Energy, Inc. In August 2014, it acquired Alta Wind facility located in Tehachapi, California from Terra-Gen Power LLC.

Receive News & Ratings for Exelon Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Exelon and related companies with MarketBeat.com's FREE daily email newsletter.

Comments

Leave a Reply


share news on Facebook
tweet this investment news
share on linkedin
share on StockTwits
share on Google Plus
share on reddit