Energias de Portugal (OTCMKTS:EDPFY) vs. RWE (OTCMKTS:RWEOY) Critical Comparison

RWE (OTCMKTS:RWEOY) and Energias de Portugal (OTCMKTS:EDPFY) are both large-cap utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, institutional ownership, valuation, profitability, analyst recommendations, earnings and dividends.

Profitability

This table compares RWE and Energias de Portugal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RWE	17.96%	4.96%	1.88%
Energias de Portugal	N/A	N/A	N/A

Dividends

RWE pays an annual dividend of $0.87 per share and has a dividend yield of 1.4%. Energias de Portugal pays an annual dividend of $1.43 per share and has a dividend yield of 2.9%. RWE pays out 17.8% of its earnings in the form of a dividend. Energias de Portugal pays out 120.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings and Valuation

This table compares RWE and Energias de Portugal”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RWE	$19.94 billion	2.29	$3.54 billion	$4.88	12.90
Energias de Portugal	N/A	N/A	N/A	$1.19	42.09

RWE has higher revenue and earnings than Energias de Portugal. RWE is trading at a lower price-to-earnings ratio than Energias de Portugal, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for RWE and Energias de Portugal, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RWE	0	3	1	1	2.60
Energias de Portugal	0	1	1	0	2.50

RWE currently has a consensus target price of $53.30, indicating a potential downside of 15.34%. Given RWE’s stronger consensus rating and higher probable upside, equities research analysts plainly believe RWE is more favorable than Energias de Portugal.

Risk & Volatility

RWE has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500. Comparatively, Energias de Portugal has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.

Summary

RWE beats Energias de Portugal on 10 of the 12 factors compared between the two stocks.

About RWE

RWE Aktiengesellschaft generates and supplies electricity from renewable and conventional sources in Germany, the United Kingdom, rest of Europe, North America, and internationally. It operates through five segments: Offshore Wind; Onshore Wind/Solar; Hydro/Biomass/Gas; Supply & Trading; and Coal/Nuclear. The company generates wind, hydro, solar, nuclear, gas, and biomass electricity. It also trades in electricity, gas, and energy commodities; operates gas storage facilities; and engages in battery storage activities. The company serves commercial, industrial, and corporate customers. RWE Aktiengesellschaft was founded in 1898 and is headquartered in Essen, Germany.

About Energias de Portugal

EDP – Energias de Portugal, S.A. engages in the generation, transmission, distribution, and supply of electricity in Portugal, Spain, France, Poland, Romania, Italy, Belgium, the United Kingdom, Greece, Colombia, Brazil, North America, and internationally. It operates through Renewables, Networks, and Client Solutions & Energy Management segments. The company primarily generates and sells electricity through hydro, CCGT, coal, wind, solar, nuclear, and cogeneration and waste sources. It has an installed capacity of 28 GW; and operates 380,788 kilometers of distribution network lines. The company is also involved in the supply of natural gas. In addition, it offers engineering, laboratory tests, professional training, and energy services, as well as property management services. The company's electricity and gas customers include domestic, industrial, commercial, agricultural, and others. The company was incorporated in 1976 and is headquartered in Lisbon, Portugal.