Fortis (NYSE:FTS) vs. Iberdrola (OTCMKTS:IBDRY) Head-To-Head Contrast

Fortis (NYSE:FTS) and Iberdrola (OTCMKTS:IBDRY) are both large-cap utilities companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, analyst recommendations, institutional ownership, risk and valuation.

Dividends

Fortis pays an annual dividend of $1.89 per share and has a dividend yield of 3.2%. Iberdrola pays an annual dividend of $3.01 per share and has a dividend yield of 3.1%. Fortis pays out 76.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Iberdrola pays out 74.1% of its earnings in the form of a dividend. Fortis has raised its dividend for 5 consecutive years. Fortis is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Fortis has a beta of 0.43, meaning that its share price is 57% less volatile than the S&P 500. Comparatively, Iberdrola has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500.

Profitability

This table compares Fortis and Iberdrola’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fortis	14.21%	7.25%	2.37%
Iberdrola	13.40%	9.88%	3.81%

Earnings and Valuation

This table compares Fortis and Iberdrola”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fortis	$8.71 billion	3.45	$1.29 billion	$2.46	23.90
Iberdrola	$51.52 billion	3.18	$7.11 billion	$4.06	23.91

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

Analyst Recommendations

This is a summary of recent ratings and target prices for Fortis and Iberdrola, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fortis	0	6	5	0	2.45
Iberdrola	1	5	3	0	2.22

Fortis currently has a consensus target price of $61.00, suggesting a potential upside of 3.74%. Given Fortis’ stronger consensus rating and higher possible upside, analysts plainly believe Fortis is more favorable than Iberdrola.

Institutional and Insider Ownership

57.8% of Fortis shares are owned by institutional investors. Comparatively, 0.0% of Iberdrola shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

About Fortis

Fortis Inc. operates as an electric and gas utility company in Canada, the United States, and the Caribbean countries. It generates, transmits, and distributes electricity to approximately 447,000 retail customers in southeastern Arizona; and 103,000 retail customers in Arizona's Mohave and Santa Cruz counties with an aggregate capacity of 3,408 megawatts (MW), including 68 MW of solar capacity and 250 MV of wind capacity. The company also sells wholesale electricity to other entities in the western United States; owns gas-fired and hydroelectric generating capacity totaling 65 MW; and distributes natural gas to approximately 1,087,000 residential, commercial, and industrial customers in British Columbia, Canada. In addition, it owns and operates the electricity distribution system that serves approximately 592,000 customers in southern and central Alberta; owns four hydroelectric generating facilities with a combined capacity of 225 MW; and provides operation, maintenance, and management services to five hydroelectric generating facilities. Further, the company distributes electricity in the island portion of Newfoundland and Labrador with an installed generating capacity of 145 MW; and on Prince Edward Island with a generating capacity of 90 MW. Additionally, it provides integrated electric utility service to approximately 69,000 customers in Ontario; approximately 275,000 customers in Newfoundland and Labrador; approximately 34,000 customers on Grand Cayman, Cayman Islands; and approximately 17,000 customers on certain islands in Turks and Caicos. It also holds long-term contracted generation assets in Belize consisting of 3 hydroelectric generating facilities with a combined capacity of 51 MW; and the Aitken Creek natural gas storage facility. It also owns and operates approximately 90,500 circuit Kilometers (km) of distribution lines; and approximately 51,600 km of natural gas pipelines. Fortis Inc. was founded in 1885 and is headquartered in St. John's, Canada.

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.