MGE Energy (NASDAQ:MGEE) vs. Avista (NYSE:AVA) Head to Head Analysis

Avista (NYSE:AVA) and MGE Energy (NASDAQ:MGEE) are both mid-cap utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, earnings, risk and institutional ownership.

Institutional & Insider Ownership

85.2% of Avista shares are held by institutional investors. Comparatively, 52.6% of MGE Energy shares are held by institutional investors. 0.8% of Avista shares are held by company insiders. Comparatively, 0.4% of MGE Energy shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Risk and Volatility

Avista has a beta of 0.24, meaning that its stock price is 76% less volatile than the S&P 500. Comparatively, MGE Energy has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Avista and MGE Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avista	1	4	1	0	2.00
MGE Energy	1	2	0	0	1.67

Avista presently has a consensus target price of $40.25, suggesting a potential downside of 1.25%. MGE Energy has a consensus target price of $80.50, suggesting a potential downside of 0.12%. Given MGE Energy’s higher probable upside, analysts plainly believe MGE Energy is more favorable than Avista.

Profitability

This table compares Avista and MGE Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Avista	9.83%	7.29%	2.38%
MGE Energy	18.27%	10.60%	4.59%

Dividends

Avista pays an annual dividend of $1.97 per share and has a dividend yield of 4.8%. MGE Energy pays an annual dividend of $1.90 per share and has a dividend yield of 2.4%. Avista pays out 82.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MGE Energy pays out 51.1% of its earnings in the form of a dividend. Avista has raised its dividend for 23 consecutive years and MGE Energy has raised its dividend for 49 consecutive years.

Valuation and Earnings

This table compares Avista and MGE Energy”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Avista	$1.96 billion	1.71	$193.00 million	$2.38	17.13
MGE Energy	$743.65 million	3.98	$135.89 million	$3.72	21.67

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

Summary

MGE Energy beats Avista on 10 of the 17 factors compared between the two stocks.

About Avista

Avista Corporation, together with its subsidiaries, operates as an electric and natural gas utility company. It operates in two segments, Avista Utilities and AEL&P. The Avista Utilities segment provides electric distribution and transmission, and natural gas distribution services in parts of eastern Washington and northern Idaho; and natural gas distribution services in parts of northeastern and southwestern Oregon, as well as generates electricity in Washington, Idaho, Oregon, and Montana. This segment also engages in the supply of electricity to customers in Montana; and wholesale purchase and sale of electricity and natural gas. The AEL&P segment offers electric services in Juneau, Alaska. The company generates electricity through hydroelectric, thermal, wind, and solar generation facilities. As of December 31, 2023, it supplied retail electric services to approximately 416,000 customers; and retail natural gas services to approximately 381,000 customers. The company also operates five hydroelectric generation facilities with capacity of 102.7 MW; and four diesel generating facilities with a capacity of 107.5 MW. It also engages in venture fund investments, real estate investments, and other investments. Avista Corporation was incorporated in 1889 and is headquartered in Spokane, Washington.

About MGE Energy

MGE Energy, Inc., through its subsidiaries, operates as a public utility holding company primarily in the United States. It operates through Regulated Electric Utility Operations; Regulated Gas Utility Operations; Nonregulated Energy Operations; Transmission Investments; and All Other segments. The company generates, purchases, and distributes electricity and natural gas in Wisconsin and Iowa; owns and leases electric generating capacity; and plans, constructs, operates, maintains, and expands transmission facilities to provide transmission power services. It generates electricity from coal-fired, gas-fired, and renewable energy sources. As of December 31, 2023, the company owned and operated 835 miles of overhead electric distribution lines; 1,330 miles of underground electric distribution cables; 49 substations with an installed capacity of 1.2 million kVA; and gas facilities, including 3,066 miles of distribution mains, as well as supplied electric service to approximately 163,000 customers. MGE Energy, Inc. founded in 2001 and is headquartered in Madison, Wisconsin.