Financial Analysis: Ameresco (NYSE:AMRC) versus Expand Energy (NASDAQ:EXE)

Expand Energy (NASDAQ:EXE) and Ameresco (NYSE:AMRC) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, dividends, institutional ownership and risk.

Volatility and Risk

Expand Energy has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500. Comparatively, Ameresco has a beta of 2.51, suggesting that its stock price is 151% more volatile than the S&P 500.

Profitability

This table compares Expand Energy and Ameresco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Expand Energy	7.99%	6.31%	4.02%
Ameresco	3.34%	6.97%	1.74%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Expand Energy and Ameresco, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Expand Energy	0	3	17	2	2.95
Ameresco	0	4	7	1	2.75

Expand Energy presently has a consensus price target of $129.44, suggesting a potential upside of 16.40%. Ameresco has a consensus price target of $37.70, suggesting a potential upside of 24.24%. Given Ameresco’s higher probable upside, analysts plainly believe Ameresco is more favorable than Expand Energy.

Earnings and Valuation

This table compares Expand Energy and Ameresco”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Expand Energy	$4.24 billion	6.25	-$714.00 million	$3.52	31.59
Ameresco	$1.77 billion	0.91	$56.76 million	$1.19	25.50

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

Institutional and Insider Ownership

97.9% of Expand Energy shares are owned by institutional investors. Comparatively, 99.2% of Ameresco shares are owned by institutional investors. 0.2% of Expand Energy shares are owned by company insiders. Comparatively, 45.0% of Ameresco shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Expand Energy beats Ameresco on 9 of the 15 factors compared between the two stocks.

About Expand Energy

Expand Energy Corporation is an independent natural gas producer principally in the United States. Expand Energy Corporation, formerly known as Chesapeake Energy Corporation, is based in OKLAHOMA CITY.

About Ameresco

Ameresco, Inc., a clean technology integrator, provides a portfolio of energy efficiency and renewable energy supply solutions in the United States, Canada, Europe, and internationally. It operates through U.S. Regions, U.S. Federal, Canada, Europe, Alternative Fuels, and All Other segments. The company offers energy efficiency, infrastructure upgrades, energy security and resilience, asset sustainability, and renewable energy solutions for businesses and organizations. It designs, develops, engineers, and installs projects that reduce the energy, as well as operations and maintenance (O&M) costs of its customers' facilities; and projects primarily include various measures customized for the facility and designed to enhance the efficiency of building systems, such as heating, ventilation, cooling, and lighting systems. In addition, the company offers renewable energy solutions and services, such as the construction of small-scale plants that the company owns or develops for customers that produce electricity, gas, heat, or cooling from renewable sources of energy and O&M services; and electricity, processed renewable gas fuel, and heat or cooling produced from renewable sources of energy. Further, the company sells photovoltaic (PV) solar energy products and systems, as well as provides consulting, and enterprise energy management services; and operates wind farms. It serves the federal, state, local governments, healthcare and educational institutions, airports, public housing authorities and public universities, municipal utilities, and commercial and industrial customers. As of December 31, 2023, the company owned and operated 185 small-scale renewable energy plants and solar PV installations. Ameresco, Inc. was incorporated in 2000 and is headquartered in Framingham, Massachusetts.