Critical Comparison: Public Service Enterprise Group (NYSE:PEG) and Iberdrola (OTCMKTS:IBDSF)

Public Service Enterprise Group (NYSE:PEG) and Iberdrola (OTCMKTS:IBDSF) are both utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Public Service Enterprise Group and Iberdrola, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Public Service Enterprise Group	0	10	6	1	2.47
Iberdrola	0	0	0	0	0.00

Public Service Enterprise Group currently has a consensus target price of $89.43, indicating a potential upside of 23.00%. Given Public Service Enterprise Group’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Public Service Enterprise Group is more favorable than Iberdrola.

Dividends

Public Service Enterprise Group pays an annual dividend of $2.68 per share and has a dividend yield of 3.7%. Iberdrola pays an annual dividend of $0.02 per share and has a dividend yield of 0.1%. Public Service Enterprise Group pays out 66.7% of its earnings in the form of a dividend. Iberdrola pays out 7.1% 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. Public Service Enterprise Group has raised its dividend for 14 consecutive years. Public Service Enterprise Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

73.3% of Public Service Enterprise Group shares are held by institutional investors. Comparatively, 16.5% of Iberdrola shares are held by institutional investors. 0.2% of Public Service Enterprise Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Public Service Enterprise Group and Iberdrola”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Public Service Enterprise Group	$12.17 billion	2.98	$2.11 billion	$4.02	18.09
Iberdrola	N/A	N/A	N/A	$0.33	70.90

Public Service Enterprise Group has higher revenue and earnings than Iberdrola. Public Service Enterprise Group is trading at a lower price-to-earnings ratio than Iberdrola, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Public Service Enterprise Group and Iberdrola’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Public Service Enterprise Group	16.04%	12.42%	3.68%
Iberdrola	N/A	N/A	N/A

Summary

Public Service Enterprise Group beats Iberdrola on 13 of the 15 factors compared between the two stocks.

About Public Service Enterprise Group

Public Service Enterprise Group Incorporated, through its subsidiaries, operates in electric and gas utility business in the United States. It operates through PSE&G and PSEG Power segments. The PSE&G segment transmits electricity; distributes electricity and natural gas to residential, commercial, and industrial customers; and appliance services and repairs to customers through its service territory, as well as invests in solar generation projects, and energy efficiency and related programs. The PSEG Power segment engages in nuclear generation businesses; and supplies power and natural gas to nuclear power plants and gas storage facilities activities. As of December 31, 2023, it had electric transmission and distribution system of 25,000 circuit miles and 866,600 poles; 56 switching stations with an installed capacity of 39,953 megavolt-amperes (MVA), and 235 substations with an installed capacity of 10,382 MVA; 109 MVA aggregate installed capacity for substations; four electric distribution headquarters and five electric sub-headquarters; 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 56 natural gas metering and regulating stations; and 158 MegaWatts defined conditions of installed PV solar capacity. Public Service Enterprise Group Incorporated was founded in 1903 and is based in Newark, New Jersey.

About Iberdrola

Iberdrola, S.A. engages in the generation, transmission, distribution, and supply of electricity in Spain, the United Kingdom, the United States, Mexico, Brazil, Germany, France, and Australia. It generates electricity from renewable sources, such as onshore and offshore wind, hydro, photovoltaic, combined cycle gas, and conventional nuclear, as well as through batteries. The company is also involved in the purchase and sale of electricity and gas on wholesale markets; energy retail supply activities, such as gas and electricity, and other products and services, including hydrogen, as well as non-renewable generation; and production of green hydrogen. It has a total installed capacity of 62,871 MW. In addition, the company offers heat pumps, self-consumption, electric mobility, solar, etc. services to residential customers; and management of energy facilities, as well as supplies green H2, industrial heat, etc. to industrial customers. Iberdrola, S.A. was founded in 1840 and is based in Bilbao, Spain.