Analyzing National Grid Transco, PLC (NYSE:NGG) & MDU Resources Group (MDU)

National Grid Transco, PLC (NYSE: NGG) and MDU Resources Group (NYSE:MDU) are both mid-cap utilities companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, risk and valuation.

Volatility & Risk

National Grid Transco, PLC has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500. Comparatively, MDU Resources Group has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500.

Dividends

National Grid Transco, PLC pays an annual dividend of $2.89 per share and has a dividend yield of 4.6%. MDU Resources Group pays an annual dividend of $0.77 per share and has a dividend yield of 3.0%. MDU Resources Group pays out 67.0% of its earnings in the form of a dividend. MDU Resources Group has increased its dividend for 7 consecutive years.

Valuation & Earnings

This table compares National Grid Transco, PLC and MDU Resources Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
National Grid Transco, PLC $19.86 billion 2.17 $6.72 billion N/A N/A
MDU Resources Group $4.23 billion 1.18 $617.43 million $1.15 22.28

National Grid Transco, PLC has higher revenue and earnings than MDU Resources Group.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for National Grid Transco, PLC and MDU Resources Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Grid Transco, PLC 2 6 7 0 2.33
MDU Resources Group 0 2 0 0 2.00

National Grid Transco, PLC presently has a consensus price target of $69.00, suggesting a potential upside of 9.73%. MDU Resources Group has a consensus price target of $36.00, suggesting a potential upside of 40.52%. Given MDU Resources Group’s higher possible upside, analysts plainly believe MDU Resources Group is more favorable than National Grid Transco, PLC.

Insider & Institutional Ownership

5.7% of National Grid Transco, PLC shares are held by institutional investors. Comparatively, 63.4% of MDU Resources Group shares are held by institutional investors. 1.0% of MDU Resources Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares National Grid Transco, PLC and MDU Resources Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National Grid Transco, PLC N/A N/A N/A
MDU Resources Group 5.37% 10.24% 3.76%

Summary

MDU Resources Group beats National Grid Transco, PLC on 8 of the 15 factors compared between the two stocks.

National Grid Transco, PLC Company Profile

National Grid plc is an electricity and gas utility company focused on transmission and distribution activities in electricity and gas in both the United Kingdom and the United States. The Company’s segments include UK Electricity Transmission, which is engaged in high voltage electricity transmission networks in Great Britain; UK Gas Transmission, which is the gas transmission network in Great Britain and United Kingdom liquefied natural gas (LNG) storage activities; UK Gas Distribution, which includes approximately four of the eight regional networks of Great Britain’s gas distribution system, and US Regulated, which includes gas distribution networks, electricity distribution networks and high voltage electricity transmission networks in New York, and New England and electricity generation facilities in New York. Its other activities relate to non-regulated businesses and other commercial operations not included within the above segments.

MDU Resources Group Company Profile

MDU Resources Group, Inc. is engaged in regulated energy delivery and construction materials and services business. The Company’s businesses segments are electric, natural gas distribution, pipeline and midstream, construction materials and contracting, and construction services. The electric segment generates, transmits and distributes electricity. The natural gas distribution segment distributes natural gas. The pipeline and midstream segment provides natural gas transportation, underground storage, processing and gathering services, as well as oil gathering. The construction materials and contracting segment mines aggregates and markets crushed stone, sand, gravel and related construction materials, including ready-mixed concrete, asphalt, liquid asphalt and other value-added products. The construction services segment provides utility construction services in constructing and maintaining electric and communication lines, and external lighting and traffic signalization.

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