Equatorial Energia (OTCMKTS:EQUEY) vs. Eversource Energy (NYSE:ES) Critical Analysis

Equatorial Energia (OTCMKTS:EQUEY) and Eversource Energy (NYSE:ES) are both utilities companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Institutional and Insider Ownership

0.0% of Equatorial Energia shares are held by institutional investors. Comparatively, 80.0% of Eversource Energy shares are held by institutional investors. 0.4% of Eversource Energy shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Equatorial Energia and Eversource Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equatorial Energia	N/A	N/A	N/A
Eversource Energy	-0.81%	10.34%	2.69%

Earnings & Valuation

This table compares Equatorial Energia and Eversource Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equatorial Energia	N/A	N/A	N/A	$0.25	24.00
Eversource Energy	$11.35 billion	2.06	-$442.24 million	($1.18)	-56.37

Equatorial Energia has higher earnings, but lower revenue than Eversource Energy. Eversource Energy is trading at a lower price-to-earnings ratio than Equatorial Energia, indicating that it is currently the more affordable of the two stocks.

Dividends

Equatorial Energia pays an annual dividend of $0.07 per share and has a dividend yield of 1.2%. Eversource Energy pays an annual dividend of $2.86 per share and has a dividend yield of 4.3%. Equatorial Energia pays out 29.7% of its earnings in the form of a dividend. Eversource Energy pays out -242.4% 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. Eversource Energy has increased its dividend for 26 consecutive years. Eversource Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and target prices for Equatorial Energia and Eversource Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equatorial Energia	0	0	0	0	N/A
Eversource Energy	0	8	6	0	2.43

Eversource Energy has a consensus price target of $68.93, indicating a potential upside of 3.62%. Given Eversource Energy’s higher probable upside, analysts clearly believe Eversource Energy is more favorable than Equatorial Energia.

Summary

Eversource Energy beats Equatorial Energia on 10 of the 13 factors compared between the two stocks.

About Equatorial Energia

Equatorial Energia S.A., through its subsidiaries, engages in the electricity generation, distribution, transmission, and sanitation operations in Brazil. It operates through Distribution, Transmission, Wind Generation, Services, Sanitation, and Other segments. The company generates energy from wind, solar, biomass, qualified co-generation, and hydroelectric plants. It also distributes electric energy in the 217 municipalities of Maranhão State with a concession area of approximately 332,000 square kilometers serving approximately 2.5 million consumers; and 144 municipalities of Pará State with a concession area covering 1,248,000 square kilometers serving approximately 2.6 million consumers. In addition, the company distributes electric energy to 224 municipalities of Piauí State with a concession area covering 251,000 square kilometers serving approximately 1.3 million consumers; 102 municipalities of Alagoas State with a concession area covering 27,848 square kilometers serving approximately 1.2 million consumers; 16 municipalities of Amapá State serving approximately 209,000 consumers; and 72 municipalities of Rio de Janeiro State serving approximately 1.8 million consumers. Equatorial Energia S.A. was founded in 1958 and is based in Brasília, Brazil.

About Eversource Energy

Eversource Energy, a public utility holding company, engages in the energy delivery business. The company operates through Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution segments. It is involved in the transmission and distribution of electricity; solar power facilities; and distribution of natural gas. The company operates regulated water utilities that provide water services to approximately 241,000 customers. It serves residential, commercial, industrial, municipal and fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. Eversource Energy was incorporated in 1927 and is headquartered in Springfield, Massachusetts.