Analyzing Southern (SO) and CENTRICA PLC/S (CPYYY)
Southern (NYSE:SO) and CENTRICA PLC/S (OTCMKTS:CPYYY) are both large-cap utilities companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, profitability, valuation and risk.
Volatility and Risk
Southern has a beta of -0.05, indicating that its stock price is 105% less volatile than the S&P 500. Comparatively, CENTRICA PLC/S has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500.
Southern pays an annual dividend of $2.40 per share and has a dividend yield of 5.5%. CENTRICA PLC/S pays an annual dividend of $0.85 per share and has a dividend yield of 11.0%. Southern pays out 79.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CENTRICA PLC/S pays out 130.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Southern has raised its dividend for 16 consecutive years.
This table compares Southern and CENTRICA PLC/S’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider & Institutional Ownership
57.4% of Southern shares are held by institutional investors. Comparatively, 0.1% of CENTRICA PLC/S shares are held by institutional investors. 0.7% of Southern shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Southern and CENTRICA PLC/S’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Southern||$23.03 billion||1.92||$880.00 million||$3.02||14.43|
|CENTRICA PLC/S||$36.11 billion||0.30||$429.17 million||$0.65||11.94|
Southern has higher earnings, but lower revenue than CENTRICA PLC/S. CENTRICA PLC/S is trading at a lower price-to-earnings ratio than Southern, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent recommendations and price targets for Southern and CENTRICA PLC/S, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Southern currently has a consensus price target of $45.81, suggesting a potential upside of 5.11%. Given Southern’s higher possible upside, equities research analysts clearly believe Southern is more favorable than CENTRICA PLC/S.
Southern beats CENTRICA PLC/S on 12 of the 17 factors compared between the two stocks.
Southern Company Profile
The Southern Company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity. The company also constructs, acquires, owns, and manages power generation assets, including renewable energy facilities and sells electricity in the wholesale market; and distributes natural gas in Illinois, Georgia, Virginia, New Jersey, Florida, Tennessee, and Maryland, as well as provides gas marketing services, wholesale gas services, and gas midstream operations. It owns and/or operates 33 hydroelectric generating stations, 29 fossil fuel generating stations, 3 nuclear generating stations, 15 combined cycle/cogeneration stations, 35 solar facilities, 8 wind facilities, 1 biomass facility, and 1 landfill gas facility; and constructs, operates, and maintains 82,000 miles of natural gas pipelines and 14 storage facilities with total capacity of 158 Bcf to provide natural gas to residential, commercial, and industrial customers. The company has 46,000 megawatts of generating capacity and 1,500 billion cubic feet of combined natural gas consumption and throughput volume serving 9 million electric and gas utility customers. It also provides products and services in the areas of distributed generation infrastructure, energy efficiency, and utility infrastructure. In addition, the company offers digital wireless communications services with various communication options, including push to talk, cellular service, text messaging, wireless Internet access, and wireless data. The Southern Company was founded in 1945 and is headquartered in Atlanta, Georgia.
CENTRICA PLC/S Company Profile
Centrica plc operates as an integrated energy company in the United Kingdom, the Republic of Ireland, Germany, Norway, rest of Europe, the United States, Canada, and internationally. The company operates through Centrica Consumer, Centrica Business, Exploration & Production, and Centrica Storage segments. It supplies gas and electricity to residential customers, as well as offers energy-related services; and generates power from combined cycle gas turbines and nuclear assets. The company also provides installation, repair, and maintenance services for domestic central heating, plumbing and drains, and gas and kitchen appliances; heating, ventilation, and air conditioning equipment; and water heaters, as well as offers breakdown services. In addition, it is involved in the procurement, trading, and optimization of energy; and supplies energy efficiency solutions and technologies to residential customers. Further, the company produces and processes gas and oil; develops new fields to maintain reserves; constructs, owns, and exploits infrastructure; and engages in the social enterprise investment fund activities. Additionally, it is involved in the trade and optimization of energy activities; provision of vehicle leasing, commercial, and insurance services, as well as energy management products and services; and operates a gas storage, and franchise network. The company also provides intermediary services, including claims handling and administration, as well as business, finance, and data management services; and offers sea freight water transport services. It primarily supplies energy and services to approximately 25 million customers under the British Gas, Direct Energy, and Bord Gáis Energy brands. The company was formerly known as Yieldtop plc and changed its name to Centrica plc in December 1996. Centrica plc was incorporated in 1995 and is headquartered in Windsor, the United Kingdom.
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