National Fuel Gas (NYSE:NFG – Get Free Report) and NewJersey Resources (NYSE:NJR – Get Free Report) are both mid-cap utilities companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.
Volatility & Risk
National Fuel Gas has a beta of 0.36, meaning that its stock price is 64% less volatile than the S&P 500. Comparatively, NewJersey Resources has a beta of 0.45, meaning that its stock price is 55% less volatile than the S&P 500.
Institutional and Insider Ownership
74.0% of National Fuel Gas shares are owned by institutional investors. Comparatively, 71.0% of NewJersey Resources shares are owned by institutional investors. 1.3% of National Fuel Gas shares are owned by company insiders. Comparatively, 0.7% of NewJersey Resources shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares National Fuel Gas and NewJersey Resources”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| National Fuel Gas | $2.51 billion | 2.78 | $665.44 million | $7.04 | 10.45 |
| NewJersey Resources | $2.23 billion | 2.47 | $335.63 million | $3.62 | 14.99 |
National Fuel Gas has higher revenue and earnings than NewJersey Resources. National Fuel Gas is trading at a lower price-to-earnings ratio than NewJersey Resources, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current ratings for National Fuel Gas and NewJersey Resources, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| National Fuel Gas | 0 | 1 | 2 | 0 | 2.67 |
| NewJersey Resources | 0 | 2 | 4 | 1 | 2.86 |
National Fuel Gas presently has a consensus target price of $105.50, indicating a potential upside of 43.39%. NewJersey Resources has a consensus target price of $62.50, indicating a potential upside of 15.15%. Given National Fuel Gas’ higher probable upside, equities research analysts plainly believe National Fuel Gas is more favorable than NewJersey Resources.
Profitability
This table compares National Fuel Gas and NewJersey Resources’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| National Fuel Gas | 26.46% | 17.95% | 6.91% |
| NewJersey Resources | 16.42% | 14.46% | 4.67% |
Dividends
National Fuel Gas pays an annual dividend of $2.22 per share and has a dividend yield of 3.0%. NewJersey Resources pays an annual dividend of $2.00 per share and has a dividend yield of 3.7%. National Fuel Gas pays out 31.5% of its earnings in the form of a dividend. NewJersey Resources pays out 55.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. National Fuel Gas has increased its dividend for 55 consecutive years and NewJersey Resources has increased its dividend for 29 consecutive years.
Summary
National Fuel Gas beats NewJersey Resources on 12 of the 18 factors compared between the two stocks.
About National Fuel Gas
National Fuel Gas Company operates as a diversified energy company. It operates through four segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. The Exploration and Production segment explores for, develops, and produces natural gas and oil. The Pipeline and Storage segment provides interstate natural gas transportation services through an integrated gas pipeline system in Pennsylvania and New York; and owns and operates underground natural gas storage fields. This segment also transports natural gas for National Fuel Gas Distribution Corporation, as well as for other utilities, industrial companies, and power producers in New York State. The Gathering segment builds, owns, and operates natural gas processing and pipeline gathering facilities in the Appalachian region, as well as provides gathering services to Seneca. The Utility segment sells natural gas or provides natural gas utility services to various customers in Buffalo, Niagara Falls, and Jamestown, New York; and Erie and Sharon, Pennsylvania. National Fuel Gas Company was incorporated in 1902 and is headquartered in Williamsville, New York.
About NewJersey Resources
New Jersey Resources Corporation, an energy services holding company, distributes natural gas. The company operates through four segments: Natural Gas Distribution, Clean Energy Ventures, Energy Services, and Storage and Transportation. The Natural Gas Distribution segment offers regulated natural gas utility services to approximately 576,000 customers in Burlington, Middlesex, Monmouth, Morris, Ocean, and Sussex counties in New Jersey; provides capacity and storage management services; and participates in the off-system sales and capacity release markets. The Clean Energy Ventures segment invests in, owns, and operates clean energy projects, including commercial and residential solar installation situated in New Jersey, Rhode Island, New York, Connecticut, Michigan, and Indiana. The Energy Services segment maintains and operates natural gas transportation and storage capacity contracts, as well as provides physical wholesale energy, retail energy and energy management services in the United States and Canada. The Storage and Transportation segment invests in invests in energy-related ventures. It provides heating, ventilation, and cooling services; sales and installation of appliances; offers solar equipment installation, and plumbing repair and installation services; and holds commercial real estate properties. The company was incorporated in 1981 and is headquartered in Wall, New Jersey.
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