Head-To-Head Contrast: Unitil (NYSE:UTL) and Iberdrola (OTCMKTS:IBDSF)

Iberdrola (OTCMKTS:IBDSF) and Unitil (NYSE:UTL) are both utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.

Insider and Institutional Ownership

16.5% of Iberdrola shares are held by institutional investors. Comparatively, 76.8% of Unitil shares are held by institutional investors. 1.9% of Unitil shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Iberdrola and Unitil’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Iberdrola	N/A	N/A	N/A	$0.33	36.78
Unitil	$557.10 million	1.46	$45.20 million	$2.82	17.89

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Iberdrola	N/A	N/A	N/A
Unitil	8.11%	9.32%	2.78%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Iberdrola and Unitil, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Iberdrola	0	0	0	0	N/A
Unitil	0	2	0	0	2.00

Unitil has a consensus target price of $51.00, indicating a potential upside of 1.11%. Given Unitil’s higher possible upside, analysts clearly believe Unitil is more favorable than Iberdrola.

Dividends

Iberdrola pays an annual dividend of $0.02 per share and has a dividend yield of 0.2%. Unitil pays an annual dividend of $1.70 per share and has a dividend yield of 3.4%. Iberdrola pays out 7.1% of its earnings in the form of a dividend. Unitil pays out 60.3% 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. Unitil has increased its dividend for 10 consecutive years. Unitil is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Unitil beats Iberdrola on 10 of the 12 factors compared between the two stocks.

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.

About Unitil

Unitil Corporation, a public utility holding company, engages in the distribution of electricity and natural gas. It operates through two segments, Utility Electric Operations, Utility Gas Operations. The company distributes electricity in the southeastern seacoast and state capital regions of New Hampshire, and the greater Fitchburg area of north central Massachusetts; and distributes natural gas in southeastern New Hampshire and portions of southern and central Maine, including the city of Portland and the Lewiston-Auburn area, as well as electricity and natural gas in the greater Fitchburg area of north central Massachusetts. It also operates 86 miles of interstate underground natural gas transmission pipeline that provides interstate natural gas pipeline access and transportation services primarily in Maine and New Hampshire. In addition, the company provides real estate management services. It serves approximately 108,100 electric customers and 87,500 natural gas customers. Unitil Corporation was incorporated in 1984 and is headquartered in Hampton, New Hampshire.