Cleco Corporate (NYSE: CNL) and Dominion Energy (NYSE:D) are both mid-cap utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, earnings, analyst recommendations, institutional ownership, dividends, valuation and risk.

Risk and Volatility

Cleco Corporate has a beta of 0.53, indicating that its stock price is 47% less volatile than the S&P 500. Comparatively, Dominion Energy has a beta of 0.3, indicating that its stock price is 70% less volatile than the S&P 500.

Institutional & Insider Ownership

64.6% of Dominion Energy shares are owned by institutional investors. 0.4% of Dominion Energy shares are owned 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.

Analyst Recommendations

This is a summary of current ratings and target prices for Cleco Corporate and Dominion Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cleco Corporate 0 0 0 0 N/A
Dominion Energy 0 9 4 0 2.31

Dominion Energy has a consensus target price of $81.78, suggesting a potential upside of 7.31%. Given Dominion Energy’s higher probable upside, analysts plainly believe Dominion Energy is more favorable than Cleco Corporate.

Earnings and Valuation

This table compares Cleco Corporate and Dominion Energy’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cleco Corporate N/A N/A N/A $2.20 25.16
Dominion Energy $11.73 billion 4.19 $2.12 billion $3.39 22.48

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

Dividends

Cleco Corporate pays an annual dividend of $1.60 per share and has a dividend yield of 2.9%. Dominion Energy pays an annual dividend of $3.08 per share and has a dividend yield of 4.0%. Cleco Corporate pays out 72.7% of its earnings in the form of a dividend. Dominion Energy pays out 90.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cleco Corporate has increased its dividend for 9 consecutive years and Dominion Energy has increased its dividend for 8 consecutive years.

Profitability

This table compares Cleco Corporate and Dominion Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cleco Corporate 13.38% 8.95% 2.84%
Dominion Energy 17.21% 13.32% 3.16%

Summary

Dominion Energy beats Cleco Corporate on 10 of the 14 factors compared between the two stocks.

About Cleco Corporate

Cleco Corporate Holdings LLC, formerly Cleco Corporation, is a public utility holding company. The Company’s segments include Cleco Power and Other. Cleco Power is a regulated electric utility company that owns over 10 generating units with a total nameplate capacity of approximately 3,330 megawatts (MW) and serves approximately 287,000 customers in Louisiana through its retail business and supplies wholesale power in Louisiana and Mississippi. The Company, through its subsidiaries, owns one transmission substation in Louisiana and one transmission substation in Mississippi. Cleco Power is engaged in the generation, transmission, distribution and sale of electricity within Louisiana. It owns natural gas pipelines and interconnections at all of its generating facilities, which allow it to access various natural gas supply markets and maintain an economical fuel supply for its customers. The Company holds investments in its subsidiary, Cleco Power LLC (Cleco Power).

About Dominion Energy

Dominion Energy, Inc., formerly Dominion Resources, Inc., is a producer and transporter of energy. Dominion is focused on its investment in regulated electric generation, transmission and distribution and regulated natural gas transmission and distribution infrastructure. It operates through three segments: Dominion Virginia Power operating segment (DVP), Dominion Generation, Dominion Energy, and Corporate and Other. The DVP segment includes regulated electric distribution and regulated electric transmission. The Dominion Generation segment includes regulated electric fleet and merchant electric fleet. The Dominion Energy segment includes gas transmission and storage, gas gathering and processing, liquefied natural gas import and storage, and nonregulated retail energy marketing. As of December 31, 2016, Dominion served utility and retail energy customers, and operated an underground natural gas storage system with approximately one trillion cubic feet of storage capacity.

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