Westar Energy (WR) & Alliant Energy (LNT) Financial Comparison

Westar Energy (NYSE: LNT) and Alliant Energy (NYSE:LNT) are both utilities companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, earnings, profitability, institutional ownership, valuation and risk.

Risk & Volatility

Westar Energy has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500. Comparatively, Alliant Energy has a beta of 0.22, suggesting that its stock price is 78% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Westar Energy and Alliant Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Westar Energy 0 1 3 0 2.75
Alliant Energy 1 5 0 0 1.83

Westar Energy presently has a consensus target price of $56.00, suggesting a potential upside of 3.70%. Alliant Energy has a consensus target price of $44.00, suggesting a potential upside of 0.39%. Given Westar Energy’s stronger consensus rating and higher probable upside, equities analysts clearly believe Westar Energy is more favorable than Alliant Energy.

Insider and Institutional Ownership

75.1% of Westar Energy shares are held by institutional investors. Comparatively, 70.9% of Alliant Energy shares are held by institutional investors. 0.7% of Westar Energy shares are held by insiders. Comparatively, 0.3% of Alliant Energy shares are held 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 Westar Energy and Alliant Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Westar Energy 12.50% 8.40% 2.80%
Alliant Energy 14.14% 11.35% 3.36%

Valuation & Earnings

This table compares Westar Energy and Alliant Energy’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Westar Energy $2.57 billion 2.99 $323.92 million $2.27 23.79
Alliant Energy $3.38 billion 3.03 $467.50 million $1.93 22.71

Alliant Energy has higher revenue and earnings than Westar Energy. Alliant Energy is trading at a lower price-to-earnings ratio than Westar Energy, indicating that it is currently the more affordable of the two stocks.

Dividends

Westar Energy pays an annual dividend of $1.60 per share and has a dividend yield of 3.0%. Alliant Energy pays an annual dividend of $1.34 per share and has a dividend yield of 3.1%. Westar Energy pays out 70.5% of its earnings in the form of a dividend. Alliant Energy pays out 69.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Westar Energy has raised its dividend for 12 consecutive years and Alliant Energy has raised its dividend for 12 consecutive years. Alliant Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Westar Energy Company Profile

Westar Energy, Inc., an electric utility company, generates, transmits, and distributes electricity in Kansas. It has 6,602 megawatts of electric generation capacity, which generates electricity through coal, nuclear fuels, natural gas/diesel, and renewable sources. The company also owns approximately 6,400 miles of transmission lines, 24,200 miles of overhead distribution lines, and 5,100 miles of underground distribution lines. It retails electricity to residential, commercial, and industrial customers, as well as for lighting public streets and highways; and engages in the electricity wholesale to electric cooperatives, municipalities, other electric utilities, and regional transmission organizations. The company provides its services in central and northeastern Kansas, including the cities of Topeka, Lawrence, Manhattan, Salina, and Hutchinson, as well as in south-central and southeastern Kansas, such as the city of Wichita. It serves approximately 708,000 customers. Westar Energy, Inc. was founded in 1924 and is headquartered in Topeka, Kansas.

Alliant Energy Company Profile

Alliant Energy Corporation operates as a utility holding company that provides regulated electricity and natural gas services in the Midwest region of the United States. It operates through three segments: Electric, Gas, and Other. The company, through its subsidiary, Interstate Power and Light Company (IPL), primarily generates and distributes electricity, and distributes and transports natural gas to retail customers in Iowa; sells electricity to wholesale customers in Minnesota, Illinois, and Iowa; and generates and distributes steam in Cedar Rapids, Iowa. Alliant Energy Corporation, through its subsidiary, Wisconsin Power and Light Company (WPL), generates and distributes electricity, and distributes and transports natural gas to retail customers in Wisconsin; and sells electricity to wholesale customers in Wisconsin. As of December 31, 2017, IPL supplied electricity to 490,000 retail customers and natural gas to 220,000 retail customers; and WPL supplied electricity to 470,000 retail customers and natural gas to 190,000 retail customers. It offers electric utility services to retail customers in the farming, agriculture, industrial manufacturing, chemical, and paper industries. In addition, the company holds investments in various businesses, which provide freight services through a short-line railway between Cedar Rapids and Iowa City, Iowa; a barge terminal and hauling services on the Mississippi River; and other transfer and storage services. Further, it owns a non-regulated 347 megawatt (MW) natural gas-fired electric generating unit near Sheboygan Falls, Wisconsin; and a non-regulated 99 MW Franklin County wind farm located in Franklin County, Iowa. Alliant Energy Corporation was founded in 1917 and is headquartered in Madison, Wisconsin.

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