Head-To-Head Review: Ocean Thermal Energy (OTCMKTS:CPWR) and NRG Energy (NYSE:NRG)

NRG Energy (NYSE:NRG) and Ocean Thermal Energy (OTCMKTS:CPWR) are both utilities companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, dividends, earnings and profitability.

Insider & Institutional Ownership

97.7% of NRG Energy shares are held by institutional investors. Comparatively, 84.7% of Ocean Thermal Energy shares are held by institutional investors. 0.4% of NRG Energy shares are held by insiders. Comparatively, 3.3% of Ocean Thermal Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares NRG Energy and Ocean Thermal Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NRG Energy	0.74%	70.67%	4.95%
Ocean Thermal Energy	N/A	N/A	N/A

Dividends

NRG Energy pays an annual dividend of $1.90 per share and has a dividend yield of 1.4%. Ocean Thermal Energy pays an annual dividend of $0.50 per share and has a dividend yield of 7,142.9%. NRG Energy pays out 223.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ocean Thermal Energy pays out 208.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NRG Energy has increased its dividend for 1 consecutive years. Ocean Thermal Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares NRG Energy and Ocean Thermal Energy”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NRG Energy	$30.71 billion	0.92	$864.00 million	$0.85	158.30
Ocean Thermal Energy	N/A	N/A	N/A	$0.24	0.03

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

Analyst Ratings

This is a breakdown of recent ratings for NRG Energy and Ocean Thermal Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NRG Energy	0	4	10	1	2.80
Ocean Thermal Energy	0	0	0	0	0.00

NRG Energy currently has a consensus price target of $201.79, suggesting a potential upside of 49.96%. Given NRG Energy’s stronger consensus rating and higher possible upside, analysts plainly believe NRG Energy is more favorable than Ocean Thermal Energy.

Summary

NRG Energy beats Ocean Thermal Energy on 12 of the 15 factors compared between the two stocks.

About NRG Energy

NRG Energy, Inc., together with its subsidiaries, operates as an energy and home services company in the United States and Canada. It operates through Texas; East; West/Services/Other; Vivint Smart Home; and Corporate Activities segments. The company produces and sells electricity generated using coal, oil, solar, and battery storage; natural gas; and a cloud-based home platform, including hardware, software, sales, installation, customer service, technical support, and professional monitoring solutions. It offers retail electricity and energy management, line and surge protection products, HVAC installation, repair and maintenance, home protection products, carbon offsets, back-up power stations, portable power, portable solar, and portable lighting; retail services comprising demand response, commodity sales, energy efficiency, and energy management solutions; and system power, distributed generation, renewable and low-carbon products, carbon management and specialty services, backup generation, storage and distributed solar, and energy advisory services. In addition, the company trades in power, natural gas, and related commodities; environmental products; weather products; and financial products, including forwards, futures, options, and swaps. It offers its products and services under the NRG, Reliant, Direct Energy, Green Mountain Energy, and Vivint. It serves residential, commercial, government, industrial, and wholesale customers. NRG Energy, Inc. was founded in 1989 and is headquartered in Houston, Texas.

About Ocean Thermal Energy

Ocean Thermal Energy Corporation, together with its subsidiaries, engages in the development of projects for renewable power generation, desalinated water production, and air conditioning worldwide. It is involved in the design and development of ocean thermal energy conversion, and seawater and lake water air conditioning plants for commercial properties, utilities, and municipalities. The company produces electricity through ocean thermal electrical conversion plants and provides air conditioning for large commercial buildings or other facilities through seawater air conditioning and lake source cooling plants. It also produces fresh and desalinated water for human consumption, agricultural, mariculture, and fish farming/aquaculture uses. In addition, the company is involved in the development and commercialization of EcoVillages, a socially, economically, and ecologically sustainable communities. It has strategic relationships with DCO Energy, LLC. The company was founded in 1998 and is headquartered in Philadelphia, Pennsylvania.