Avangrid (AGR) versus CENTRICA PLC/S (CPYYY) Financial Analysis

Avangrid (NYSE:AGR) and CENTRICA PLC/S (OTCMKTS:CPYYY) are both utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, dividends, earnings and risk.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Avangrid and CENTRICA PLC/S, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Avangrid 2 3 5 0 2.30
CENTRICA PLC/S 1 3 2 0 2.17

Avangrid currently has a consensus target price of $53.25, indicating a potential upside of 8.72%. Given Avangrid’s stronger consensus rating and higher probable upside, equities analysts clearly believe Avangrid is more favorable than CENTRICA PLC/S.

Profitability

This table compares Avangrid and CENTRICA PLC/S’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Avangrid 6.29% 4.55% 2.21%
CENTRICA PLC/S N/A N/A N/A

Volatility & Risk

Avangrid has a beta of 0.14, indicating that its stock price is 86% less volatile than the S&P 500. Comparatively, CENTRICA PLC/S has a beta of 0.36, indicating that its stock price is 64% less volatile than the S&P 500.

Insider and Institutional Ownership

14.1% of Avangrid shares are held by institutional investors. Comparatively, 0.1% of CENTRICA PLC/S shares are held by institutional investors. 0.4% of Avangrid shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Avangrid and CENTRICA PLC/S’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Avangrid $5.96 billion 2.54 $381.00 million $2.20 22.26
CENTRICA PLC/S $36.11 billion 0.27 $429.17 million $0.65 10.73

CENTRICA PLC/S has higher revenue and earnings than Avangrid. CENTRICA PLC/S is trading at a lower price-to-earnings ratio than Avangrid, indicating that it is currently the more affordable of the two stocks.

Dividends

Avangrid pays an annual dividend of $1.76 per share and has a dividend yield of 3.6%. CENTRICA PLC/S pays an annual dividend of $0.35 per share and has a dividend yield of 5.0%. Avangrid pays out 80.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CENTRICA PLC/S pays out 53.8% of its earnings in the form of a dividend. Avangrid has increased its dividend for 2 consecutive years. CENTRICA PLC/S is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Avangrid beats CENTRICA PLC/S on 12 of the 17 factors compared between the two stocks.

Avangrid Company Profile

Avangrid, Inc. is a diversified energy and utility company. It operates regulated utilities and electricity generation assets through two primary lines of business: Avangrid Networks and Avangrid Renewables. The Avangrid Networks includes eight electric and natural gas utilities. The Avangrid Renewables provides electricity through wind power, across the United States. The company was founded in 1852 and is headquartered in Orange, CT.

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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