Pampa Energia (NYSE: PAM) and Great Plains Energy (NYSE:GXP) are both mid-cap utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Volatility & Risk

Pampa Energia has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500. Comparatively, Great Plains Energy has a beta of 0.44, suggesting that its stock price is 56% less volatile than the S&P 500.

Valuation and Earnings

This table compares Pampa Energia and Great Plains Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Pampa Energia $3.11 billion 1.56 $723.59 million $1.44 45.87
Great Plains Energy $2.69 billion 2.45 $1.11 billion $1.04 29.38

Great Plains Energy has higher revenue, but lower earnings than Pampa Energia. Great Plains Energy is trading at a lower price-to-earnings ratio than Pampa Energia, indicating that it is currently the more affordable of the two stocks.

Dividends

Great Plains Energy pays an annual dividend of $1.10 per share and has a dividend yield of 3.6%. Pampa Energia does not pay a dividend. Great Plains Energy pays out 105.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Great Plains Energy has raised its dividend for 6 consecutive years.

Insider and Institutional Ownership

44.4% of Pampa Energia shares are owned by institutional investors. Comparatively, 87.9% of Great Plains Energy shares are owned by institutional investors. 0.4% of Great Plains Energy shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Pampa Energia and Great Plains Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pampa Energia 3.37% 11.62% 2.17%
Great Plains Energy 8.00% 5.62% 1.82%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Pampa Energia and Great Plains Energy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pampa Energia 0 1 1 0 2.50
Great Plains Energy 0 2 4 0 2.67

Pampa Energia currently has a consensus price target of $72.00, suggesting a potential upside of 9.01%. Great Plains Energy has a consensus price target of $31.00, suggesting a potential upside of 1.47%. Given Pampa Energia’s higher probable upside, equities research analysts plainly believe Pampa Energia is more favorable than Great Plains Energy.

Summary

Great Plains Energy beats Pampa Energia on 9 of the 17 factors compared between the two stocks.

About Pampa Energia

Pampa Energia S.A. is an integrated electricity company. The Company, through its subsidiaries, is engaged in the generation, transmission and distribution of electricity in Argentina. Its segments include generation, transmission, distribution, oil and gas, and holding and others. Its generation segment includes a direct and indirect equity interest in Central Piedra Buena S.A., Central Termica Guemes S.A., Central Termica Loma de la Lata S.A. and Pampa Comercializadora S.A, among others, and investments in companies in the electricity generation sector. Its transmission segment includes an indirect equity interest through Compania Inversora en Transmision Electrica Citelec S.A. Its distribution segment includes an indirect equity interest in Electricidad Argentina S.A. and Empresa Distribuidora y Comercializadora Norte S.A. Its Oil and gas segment includes a direct interest in Petrolera Pampa S.A. Its holding and others segment includes financial investment operations, among others.

About Great Plains Energy

Great Plains Energy Incorporated (Great Plains Energy) is a utility holding company. The Company operates through electric utility segment. The Company’s subsidiaries with operations include Kansas City Power & Light Company (KCP&L) and KCP&L Greater Missouri Operations Company (GMO). KCP&L is an integrated, regulated electric utility that provides electricity to customers primarily in the states of Missouri and Kansas. Kansas City Power & Light Receivables Company (KCP&L Receivables Company) is the KCP&L’s subsidiary. GMO is an integrated, regulated electric utility that provides electricity to customers in the state of Missouri. GMO also provides regulated steam service to certain customers in the St. Joseph, Missouri area. GMO’s subsidiaries include GMO Receivables Company and MPS Merchant Services, Inc. (MPS Merchant). As of December 31, 2016, electric utility had approximately 6,500 megawatts (MWs) of owned generating capacity.

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