Consolidated Edison (NYSE:ED) and Edison International (NYSE:EIX) Head-To-Head Review

Consolidated Edison (NYSE:ED) and Edison International (NYSE:EIX) are both large-cap utilities companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, dividends, analyst recommendations, institutional ownership, risk and valuation.

Insider and Institutional Ownership

66.3% of Consolidated Edison shares are owned by institutional investors. Comparatively, 88.9% of Edison International shares are owned by institutional investors. 0.2% of Consolidated Edison shares are owned by insiders. Comparatively, 1.2% of Edison International shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Consolidated Edison and Edison International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Consolidated Edison	4	5	3	0	1.92
Edison International	1	8	6	1	2.44

Consolidated Edison currently has a consensus price target of $105.08, suggesting a potential upside of 6.76%. Edison International has a consensus price target of $64.30, suggesting a potential upside of 12.80%. Given Edison International’s stronger consensus rating and higher probable upside, analysts clearly believe Edison International is more favorable than Consolidated Edison.

Risk & Volatility

Consolidated Edison has a beta of 0.32, suggesting that its stock price is 68% less volatile than the S&P 500. Comparatively, Edison International has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500.

Earnings and Valuation

This table compares Consolidated Edison and Edison International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Consolidated Edison	$16.15 billion	2.20	$1.82 billion	$5.51	17.86
Edison International	$18.09 billion	1.21	$1.55 billion	$7.65	7.45

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

Profitability

This table compares Consolidated Edison and Edison International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Consolidated Edison	11.98%	8.56%	2.78%
Edison International	17.24%	13.62%	2.63%

Dividends

Consolidated Edison pays an annual dividend of $3.40 per share and has a dividend yield of 3.5%. Edison International pays an annual dividend of $3.31 per share and has a dividend yield of 5.8%. Consolidated Edison pays out 61.7% of its earnings in the form of a dividend. Edison International pays out 43.3% 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. Consolidated Edison has raised its dividend for 52 consecutive years and Edison International has raised its dividend for 23 consecutive years. Edison International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Edison International beats Consolidated Edison on 13 of the 18 factors compared between the two stocks.

About Consolidated Edison

Consolidated Edison, Inc., through its subsidiaries, engages in the regulated electric, gas, and steam delivery businesses in the United States. It offers electric services to approximately 3.7 million customers in New York City and Westchester County; gas to approximately 1.1 million customers in Manhattan, the Bronx, parts of Queens, and Westchester County; and steam to approximately 1,530 customers in parts of Manhattan. The company also supplies electricity to approximately 0.3 million customers in southeastern New York and northern New Jersey; and gas to approximately 0.2 million customers in southeastern New York. In addition, it operates 545 circuit miles of transmission lines; 15 transmission substations; 63 distribution substations; 90,051 in-service line transformers; 3,788 pole miles of overhead distribution lines; and 2,314 miles of underground distribution lines, as well as 4,363 miles of mains and 380,870 service lines for natural gas distribution. Further, the company invests in electric and gas transmission projects. It primarily sells electricity to industrial, commercial, residential, and government customers. Consolidated Edison, Inc. was founded in 1823 and is based in New York, New York.

About Edison International

Edison International, through its subsidiaries, engages in the generation and distribution of electric power. The company supplies and delivers electricity to approximately 50,000 square mile area of southern California to residential, commercial, industrial, public authorities, agricultural, and other sectors. Its transmission facilities consist of lines ranging from 55 kV to 500 kV and approximately 80 transmission substations; distribution system consists of approximately 38,000 circuit-miles of overhead lines; approximately 31,000 circuit-miles of underground lines; and 730 distribution substations. The company was founded in 1886 and is based in Rosemead, California.