Comp En De Mn Cemig ADS (NYSE:CIG – Get Free Report) and Ameren (NYSE:AEE – Get Free Report) are both utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Comp En De Mn Cemig ADS and Ameren, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Comp En De Mn Cemig ADS | 0 | 1 | 0 | 0 | 2.00 |
| Ameren | 0 | 3 | 10 | 0 | 2.77 |
Ameren has a consensus price target of $121.42, indicating a potential upside of 14.30%. Given Ameren’s stronger consensus rating and higher possible upside, analysts plainly believe Ameren is more favorable than Comp En De Mn Cemig ADS.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Comp En De Mn Cemig ADS | $7.66 billion | 0.81 | $877.05 million | $0.19 | 11.45 |
| Ameren | $8.80 billion | 3.34 | $1.46 billion | $5.68 | 18.70 |
Ameren has higher revenue and earnings than Comp En De Mn Cemig ADS. Comp En De Mn Cemig ADS is trading at a lower price-to-earnings ratio than Ameren, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Comp En De Mn Cemig ADS and Ameren’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Comp En De Mn Cemig ADS | 10.44% | 17.20% | 7.48% |
| Ameren | 17.86% | 10.95% | 3.00% |
Institutional and Insider Ownership
79.1% of Ameren shares are held by institutional investors. 0.3% of Ameren shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Dividends
Comp En De Mn Cemig ADS pays an annual dividend of $0.22 per share and has a dividend yield of 10.1%. Ameren pays an annual dividend of $3.00 per share and has a dividend yield of 2.8%. Comp En De Mn Cemig ADS pays out 115.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ameren pays out 52.8% of its earnings in the form of a dividend. Ameren has increased its dividend for 12 consecutive years.
Risk & Volatility
Comp En De Mn Cemig ADS has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, Ameren has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500.
Summary
Ameren beats Comp En De Mn Cemig ADS on 12 of the 16 factors compared between the two stocks.
About Comp En De Mn Cemig ADS
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Companhia Energética de Minas Gerais, through its subsidiaries, engages in the generation, transmission, distribution, and sale of electricity in Brazil. The company generates electricity through renewable energy sources, such as water, wind, sun, and biomass; or non-renewable sources, including fossil and nuclear fuels. As of December 31, 2016, it operated hydroelectric plants, thermoelectric plants, and solar plants with a total installed capacity of approximately 8,000 megawatts in 10 states of Brazil. It is also involved in the telecommunications and energy solutions consulting businesses; exploitation of natural gas; sale and trading of electricity; and acquisition, transport, and distribution of gas and its subproducts and derivatives, as well as provision of technology systems and systems for operational management of public service concessions, including companies operating in electricity, gas, water and sewerage, and other utility companies. The company was founded in 1952 and is headquartered in Belo Horizonte, Brazil.
About Ameren
Ameren Corporation, together with its subsidiaries, operates as a public utility holding company in the United States. The company operates through four segments: Ameren Missouri, Ameren Illinois Electric Distribution, Ameren Illinois Natural Gas, and Ameren Transmission. It engages in the rate-regulated electric generation, transmission, and distribution activities; and rate-regulated natural gas distribution business. In addition, the company generates electricity through coal, nuclear, and natural gas, as well as renewable sources, such as hydroelectric, wind, methane gas, and solar. It serves residential, commercial, and industrial customers. The company was founded in 1881 and is headquartered in Saint Louis, Missouri.
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