CenterPoint Energy (NYSE:CNP – Get Free Report) and Consolidated Edison (NYSE:ED – Get Free Report) are both large-cap utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, analyst recommendations, risk and dividends.
Dividends
CenterPoint Energy pays an annual dividend of $0.96 per share and has a dividend yield of 2.4%. Consolidated Edison pays an annual dividend of $3.55 per share and has a dividend yield of 3.3%. CenterPoint Energy pays out 56.5% of its earnings in the form of a dividend. Consolidated Edison pays out 58.3% 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. CenterPoint Energy has raised its dividend for 5 consecutive years and Consolidated Edison has raised its dividend for 52 consecutive years. Consolidated Edison is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares CenterPoint Energy and Consolidated Edison”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| CenterPoint Energy | $9.36 billion | 2.77 | $1.05 billion | $1.70 | 23.11 |
| Consolidated Edison | $16.92 billion | 2.33 | $2.02 billion | $6.09 | 17.51 |
Consolidated Edison has higher revenue and earnings than CenterPoint Energy. Consolidated Edison is trading at a lower price-to-earnings ratio than CenterPoint Energy, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
91.8% of CenterPoint Energy shares are held by institutional investors. Comparatively, 66.3% of Consolidated Edison shares are held by institutional investors. 0.2% of CenterPoint Energy shares are held by company insiders. Comparatively, 0.2% of Consolidated Edison shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Risk and Volatility
CenterPoint Energy has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500. Comparatively, Consolidated Edison has a beta of 0.27, indicating that its share price is 73% less volatile than the S&P 500.
Profitability
This table compares CenterPoint Energy and Consolidated Edison’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| CenterPoint Energy | 11.61% | 11.10% | 2.68% |
| Consolidated Edison | 12.53% | 8.44% | 2.83% |
Analyst Recommendations
This is a summary of current recommendations and price targets for CenterPoint Energy and Consolidated Edison, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| CenterPoint Energy | 0 | 8 | 9 | 0 | 2.53 |
| Consolidated Edison | 6 | 6 | 3 | 0 | 1.80 |
CenterPoint Energy currently has a consensus price target of $45.36, indicating a potential upside of 15.43%. Consolidated Edison has a consensus price target of $108.93, indicating a potential upside of 2.16%. Given CenterPoint Energy’s stronger consensus rating and higher probable upside, equities analysts clearly believe CenterPoint Energy is more favorable than Consolidated Edison.
Summary
CenterPoint Energy beats Consolidated Edison on 10 of the 17 factors compared between the two stocks.
About CenterPoint Energy
CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The company operates through two segments, Electric and Natural Gas. The Electric segment includes electric transmission and distribution services to electric customers and electric generation assets, as well as optimizes assets in the wholesale power market. The Natural Gas segment engages in the intrastate natural gas sales, and natural gas transportation and distribution for residential, commercial, industrial and institutional customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas; permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies; and provides maintenance and repair services of home appliances to customers in Minnesota and home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio, and Texas through a third party. It serves approximately 2,534,730 metered customers; owned 348 substations with transformer capacity of 79,719 megavolt amperes; and owned and operated 217 miles of intrastate pipeline in Louisiana and Texas. The company was founded in 1866 and is headquartered in Houston, Texas.
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.
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