Kenon (NYSE:KEN) and Pattern Energy Group (NASDAQ:PEGI) are both small-cap utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.

Profitability

This table compares Kenon and Pattern Energy Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kenon N/A 41.51% 13.85%
Pattern Energy Group 28.80% 6.91% 3.09%

Analyst Ratings

This is a summary of recent ratings for Kenon and Pattern Energy Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kenon 0 0 0 0 N/A
Pattern Energy Group 1 4 7 0 2.50

Pattern Energy Group has a consensus price target of $22.41, suggesting a potential upside of 18.38%. Given Pattern Energy Group’s higher possible upside, analysts clearly believe Pattern Energy Group is more favorable than Kenon.

Volatility and Risk

Kenon has a beta of 1.54, meaning that its stock price is 54% more volatile than the S&P 500. Comparatively, Pattern Energy Group has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500.

Valuation & Earnings

This table compares Kenon and Pattern Energy Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kenon $366.00 million 2.48 $236.59 million N/A N/A
Pattern Energy Group $411.34 million 4.51 -$17.90 million $0.19 99.63

Kenon has higher earnings, but lower revenue than Pattern Energy Group.

Institutional and Insider Ownership

1.6% of Kenon shares are owned by institutional investors. Comparatively, 89.8% of Pattern Energy Group shares are owned by institutional investors. 1.7% of Pattern Energy Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Pattern Energy Group pays an annual dividend of $1.69 per share and has a dividend yield of 8.9%. Kenon does not pay a dividend. Pattern Energy Group pays out 889.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pattern Energy Group has increased its dividend for 3 consecutive years.

Summary

Pattern Energy Group beats Kenon on 9 of the 14 factors compared between the two stocks.

Kenon Company Profile

Kenon Holdings Ltd., through its subsidiaries, owns, develops, and operates power generation facilities in Israel. It operates through OPC, Qoros, and Other segments. The company's power generation plants operate on natural gas and diesel. It also designs, manufactures, sells, and services passenger vehicles, parts, and accessories through a network of independent authorized retail dealers in China. As of December 31, 2017, the company's Qoros' dealerships included 113 point of sales facilities. In addition, Kenon Holdings Ltd., through its 32% equity interest in ZIM Integrated Shipping Services, Ltd., owned and chartered vessels with a total container capacity of 385,974 TEUs. Further, it develops and owns a proprietary natural gas-to-liquid technology process. The company was incorporated in 2014 and is based in Singapore.

Pattern Energy Group Company Profile

Pattern Energy Group Inc., an independent power company, focuses on the construction, ownership, and operation of various power projects in the United States, Canada, and Chile. It holds interests in various wind and solar power projects. The company sells electricity and renewable energy credits primarily to local utilities and local liquid independent system organizations markets. Pattern Energy Group Inc. was founded in 2012 and is headquartered in San Francisco, California.

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