Cosan (NYSE:CSAN) & Ameresco (NYSE:AMRC) Critical Analysis

Ameresco (NYSE:AMRC) and Cosan (NYSE:CSAN) are both mid-cap energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Profitability

This table compares Ameresco and Cosan’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ameresco	3.34%	7.00%	1.74%
Cosan	-28.08%	-27.61%	-8.25%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ameresco and Cosan, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ameresco	0	2	6	1	2.89
Cosan	2	2	1	1	2.17

Ameresco currently has a consensus target price of $28.00, indicating a potential downside of 29.68%. Cosan has a consensus target price of $9.47, indicating a potential upside of 120.16%. Given Cosan’s higher probable upside, analysts plainly believe Cosan is more favorable than Ameresco.

Institutional & Insider Ownership

99.2% of Ameresco shares are held by institutional investors. 45.0% of Ameresco shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Ameresco has a beta of 2.33, suggesting that its stock price is 133% more volatile than the S&P 500. Comparatively, Cosan has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.

Valuation and Earnings

This table compares Ameresco and Cosan”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ameresco	$1.77 billion	1.18	$56.76 million	$1.17	34.03
Cosan	$8.15 billion	0.25	-$1.75 billion	$1.32	3.26

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

Summary

Ameresco beats Cosan on 11 of the 14 factors compared between the two stocks.

About Ameresco

Ameresco, Inc., a clean technology integrator, provides a portfolio of energy efficiency and renewable energy supply solutions in the United States, Canada, Europe, and internationally. It operates through U.S. Regions, U.S. Federal, Canada, Europe, Alternative Fuels, and All Other segments. The company offers energy efficiency, infrastructure upgrades, energy security and resilience, asset sustainability, and renewable energy solutions for businesses and organizations. It designs, develops, engineers, and installs projects that reduce the energy, as well as operations and maintenance (O&M) costs of its customers' facilities; and projects primarily include various measures customized for the facility and designed to enhance the efficiency of building systems, such as heating, ventilation, cooling, and lighting systems. In addition, the company offers renewable energy solutions and services, such as the construction of small-scale plants that the company owns or develops for customers that produce electricity, gas, heat, or cooling from renewable sources of energy and O&M services; and electricity, processed renewable gas fuel, and heat or cooling produced from renewable sources of energy. Further, the company sells photovoltaic (PV) solar energy products and systems, as well as provides consulting, and enterprise energy management services; and operates wind farms. It serves the federal, state, local governments, healthcare and educational institutions, airports, public housing authorities and public universities, municipal utilities, and commercial and industrial customers. As of December 31, 2023, the company owned and operated 185 small-scale renewable energy plants and solar PV installations. Ameresco, Inc. was incorporated in 2000 and is headquartered in Framingham, Massachusetts.

About Cosan

Cosan S.A. engages in the fuel distribution business. It operates through Raízen, Compass, Moove, Rumo, and Radar segments. The company’s Raízen segment engages in the production, commercialization, origination, and trading of ethanol, bioenergy, renewable sources, and sugar; trading and resale of electricity; and distribution and commercialization of fuels and lubricants. Its Compass segment distributes piped natural gas to industrial, residential, commercial, automotive, and cogeneration customers; and develops infrastructure projects in a regasification terminal, offshore gas pipeline, and thermal generation projects utilizing natural gas, as well as commercialization of electricity and natural gas. The company’s Moove segment produces and distributes lubricants under the Comma brand. Its Rumo segment provides logistics services for rail transportation, port storage, and loading of goods, including grains and sugar; and leases locomotives, wagons, and another railroad equipment, as well as operates containers. The company’s Radar segment manages agricultural property. It operates in Brazil, England, France, Spain and Portugal, Argentina, Bolivia, Uruguay and Paraguay, the United States, Asia, and internationally. Cosan S.A. was founded in 1936 and is headquartered in São Paulo, Brazil.