Critical Contrast: Pennon Group (OTCMKTS:PEGRF) & York Water (NASDAQ:YORW)

York Water (NASDAQ:YORW) and Pennon Group (OTCMKTS:PEGRF) are both utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, valuation, institutional ownership, analyst recommendations, earnings and risk.

Earnings and Valuation

This table compares York Water and Pennon Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
York Water	$71.03 million	7.59	$23.76 million	$1.70	22.07
Pennon Group	N/A	N/A	N/A	$0.29	29.19

York Water has higher revenue and earnings than Pennon Group. York Water is trading at a lower price-to-earnings ratio than Pennon Group, indicating that it is currently the more affordable of the two stocks.

Dividends

York Water pays an annual dividend of $0.84 per share and has a dividend yield of 2.2%. Pennon Group pays an annual dividend of $0.30 per share and has a dividend yield of 3.6%. York Water pays out 49.4% of its earnings in the form of a dividend. Pennon Group pays out 104.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. York Water has raised its dividend for 26 consecutive years.

Insider & Institutional Ownership

49.9% of York Water shares are owned by institutional investors. Comparatively, 44.0% of Pennon Group shares are owned by institutional investors. 1.3% of York Water shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings for York Water and Pennon Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
York Water	0	0	0	0	N/A
Pennon Group	0	0	0	0	N/A

Profitability

This table compares York Water and Pennon Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
York Water	31.27%	10.32%	3.88%
Pennon Group	N/A	N/A	N/A

Summary

York Water beats Pennon Group on 9 of the 11 factors compared between the two stocks.

About York Water

The York Water Company impounds, purifies, and distributes drinking water. It owns and operates three wastewater collection systems; ten wastewater collection and treatment systems; and two reservoirs, including Lake Williams and Lake Redman, which hold approximately 2.2 billion gallons of water. The company also operates a 15-mile pipeline from the Susquehanna River to Lake Redman; and owns satellite groundwater systems in York, Adams, and Lancaster Counties, as well as two impounding dams on primary system located in York and Springfield Townships. It serves customers in the fixtures and furniture, electrical machinery, food products, paper, ordnance units, textile products, air conditioning systems, laundry detergents, barbells, and motorcycle industries in 56 municipalities within four counties in south-central Pennsylvania. The York Water Company was incorporated in 1816 and is based in York, Pennsylvania.

About Pennon Group

Pennon Group Plc provides clean water and wastewater services in the United Kingdom. It provides water and wastewater services for customers in Cornwall, Devon, and parts of Dorset and Somerset; water-only services in the areas of Dorset, Hampshire, and Wiltshire; and water and wastewater retail services to non-household customers in Great Britain. The company also offers regulated water to approximately 1.2 million customers in the Bristol region. Pennon Group Plc was incorporated in 1989 and is based in Exeter, the United Kingdom.