Summer Energy (OTCMKTS:SUME) versus AES (NYSE:AES) Critical Comparison

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

Insider and Institutional Ownership

93.1% of AES shares are owned by institutional investors. 0.6% of AES shares are owned by insiders. Comparatively, 56.8% of Summer Energy shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations and price targets for AES and Summer Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AES	0	7	3	0	2.30
Summer Energy	0	0	0	0	0.00

AES presently has a consensus target price of $24.27, suggesting a potential upside of 70.04%. Given AES’s stronger consensus rating and higher possible upside, equities research analysts clearly believe AES is more favorable than Summer Energy.

Risk & Volatility

AES has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500. Comparatively, Summer Energy has a beta of -163.93, indicating that its share price is 16,493% less volatile than the S&P 500.

Profitability

This table compares AES and Summer Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AES	7.40%	19.93%	3.29%
Summer Energy	N/A	N/A	N/A

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AES	$12.23 billion	0.83	$910.00 million	$1.26	11.33
Summer Energy	N/A	N/A	N/A	N/A	N/A

AES has higher revenue and earnings than Summer Energy.

Summary

AES beats Summer Energy on 9 of the 10 factors compared between the two stocks.

About AES

The AES Corporation, together with its subsidiaries, operates as a diversified power generation and utility company in the United States and internationally. The company owns and/or operates power plants to generate and sell power to customers, such as utilities, industrial users, and other intermediaries; owns and/or operates utilities to generate or purchase, distribute, transmit, and sell electricity to end-user customers in the residential, commercial, industrial, and governmental sectors; and generates and sells electricity on the wholesale market. It uses various fuels and technologies to generate electricity, such as coal, gas, hydro, wind, solar, and biomass, as well as renewables comprising energy storage and landfill gas. The company owns and/or operates a generation portfolio of approximately 34,596 megawatts and distributes power to 2.6 million customers. The company was formerly known as Applied Energy Services, Inc. and changed its name to The AES Corporation in April 2000. The AES Corporation was incorporated in 1981 and is headquartered in Arlington, Virginia.

About Summer Energy

Summer Energy Holdings, Inc., through its subsidiaries, operates as a retail electric provider in Texas, Massachusetts, New Hampshire, Ohio, and Illinois. It procures wholesale energy and resells to commercial and residential customers. The company was founded in 2011 and is headquartered in Houston, Texas.