CPFL Energia (NYSE: CPL) and UIL Holdings Corporation (NYSE:UIL) are both mid-cap utilities companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Analyst Recommendations

This is a breakdown of recent recommendations for CPFL Energia and UIL Holdings Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CPFL Energia 0 1 0 0 2.00
UIL Holdings Corporation 0 0 0 0 N/A

Dividends

CPFL Energia pays an annual dividend of $0.12 per share and has a dividend yield of 0.7%. UIL Holdings Corporation does not pay a dividend. CPFL Energia pays out 26.1% of its earnings in the form of a dividend. UIL Holdings Corporation has raised its dividend for 3 consecutive years.

Valuation & Earnings

This table compares CPFL Energia and UIL Holdings Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
CPFL Energia $5.51 billion 1.55 $258.28 million $0.46 36.41
UIL Holdings Corporation N/A N/A N/A $2.12 23.63

CPFL Energia has higher revenue and earnings than UIL Holdings Corporation. UIL Holdings Corporation is trading at a lower price-to-earnings ratio than CPFL Energia, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares CPFL Energia and UIL Holdings Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CPFL Energia 3.50% 7.35% 1.90%
UIL Holdings Corporation 4.73% 4.50% 1.21%

Institutional & Insider Ownership

1.9% of CPFL Energia shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

CPFL Energia beats UIL Holdings Corporation on 5 of the 9 factors compared between the two stocks.

CPFL Energia Company Profile

CPFL Energia S.A. is a holding company. The Company, through its subsidiaries, distributes, generates, transmits and commercializes electricity in Brazil, as well as provides energy-related services. Its segments include Distribution, Conventional Generation Sources, Renewable Energy Generation, Commercialization and Services. The Company operates its distribution segment through its eight distributors. Its installed capacity in conventional generation is approximately 2,200 megawatt (MW). The Company, through its subsidiary CPFL Geracao, holds equity interests in eight Hydroelectric Power Plants. It operates in the segment of generation of energy of renewable sources, such as wind, biomass thermal plants, SHPPs and solar, through its subsidiary, CPFL Renovaveis. The Company operates in the segment of commercialization (power competitive supply) through its subsidiary, CPFL Brasil. The Company operates in the segment of value-added services providing electricity-related services.

UIL Holdings Corporation Company Profile

UIL Holdings Corporation (UIL Holdings) is engaged in the ownership of its operating regulated utility businesses. The utility businesses consist of the electric distribution and transmission operations of The United Illuminating Company (UI) and the natural gas transportation, distribution and sales operations of The Southern Connecticut Gas Company (SCG), Connecticut Natural Gas Corporation (CNG) and The Berkshire Gas Company. The Company operates in two segments: Electric Distribution and Transmission, which is engaged in purchase, transmission, distribution and sale of electricity for residential, commercial and industrial purposes, and Gas Distribution, which is engaged in natural gas transportation, distribution and sales operations.

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