Analyzing IDACORP (IDA) and Xcel Energy (XEL)
IDACORP (NYSE: IDA) and Xcel Energy (NYSE:XEL) are both mid-cap utilities companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, risk and analyst recommendations.
IDACORP pays an annual dividend of $2.36 per share and has a dividend yield of 2.5%. Xcel Energy pays an annual dividend of $1.44 per share and has a dividend yield of 2.9%. IDACORP pays out 57.4% of its earnings in the form of a dividend. Xcel Energy pays out 61.5% 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. IDACORP has raised its dividend for 13 consecutive years and Xcel Energy has raised its dividend for 5 consecutive years.
This is a summary of recent ratings and recommmendations for IDACORP and Xcel Energy, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Xcel Energy has a consensus price target of $49.45, indicating a potential downside of 1.27%. Given Xcel Energy’s stronger consensus rating and higher probable upside, analysts clearly believe Xcel Energy is more favorable than IDACORP.
This table compares IDACORP and Xcel Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares IDACORP and Xcel Energy’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|IDACORP||$1.26 billion||3.78||$198.28 million||$4.11||23.01|
|Xcel Energy||$11.11 billion||2.29||$1.12 billion||$2.34||21.41|
Xcel Energy has higher revenue and earnings than IDACORP. Xcel Energy is trading at a lower price-to-earnings ratio than IDACORP, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
IDACORP has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, Xcel Energy has a beta of 0.21, indicating that its stock price is 79% less volatile than the S&P 500.
Insider & Institutional Ownership
75.6% of IDACORP shares are owned by institutional investors. Comparatively, 73.4% of Xcel Energy shares are owned by institutional investors. 0.7% of IDACORP shares are owned by company insiders. Comparatively, 0.2% of Xcel Energy shares are owned by company 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.
IDACORP beats Xcel Energy on 10 of the 17 factors compared between the two stocks.
IDACORP Company Profile
IDACORP, Inc. is a holding company. The Company’s principal operating subsidiary is Idaho Power Company (Idaho Power). The Company’s segment is utility operations. The utility operations segment’s primary source of revenue is the regulated operations of Idaho Power. Idaho Power is an electric utility engaged in the generation, transmission, distribution, sale and purchase of electric energy and capacity. Idaho Power is the parent of Idaho Energy Resources Co. (IERCo), a joint venturer in Bridger Coal Company, which mines and supplies coal to the Jim Bridger generating plant owned in part by Idaho Power. Its subsidiaries also include IDACORP Financial Services, Inc., an investor in affordable housing and other real estate investments, and Ida-West Energy Company, an operator of small hydroelectric generation projects. As of December 31, 2016, Idaho Power provided electric utility service to approximately 535,000 general business customers in southern Idaho and eastern Oregon.
Xcel Energy Company Profile
Xcel Energy Inc. is a public utility holding company. The Company’s operations include the activity of four utility subsidiaries that serve electric and natural gas customers in eight states. The Company’s segments include regulated electric utility, regulated natural gas utility and all other. The Company’s utility subsidiaries include NSP-Minnesota, NSP-Wisconsin, Public Service Company of Colorado (PSCo) and Southwestern Public Service Co. (SPS), which serve customers in portions of Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas and Wisconsin. Along with WYCO Development LLC (WYCO), a joint venture formed with Colorado Interstate Gas Company, LLC (CIG) to develop and lease natural gas pipelines storage and compression facilities, and WestGas InterState, Inc. (WGI), an interstate natural gas pipeline company, these companies comprise the regulated utility operations.
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