Equatorial Energia (OTCMKTS:EQUEY) versus Entergy (NYSE:ETR) Critical Comparison

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Entergy	14.75%	10.10%	2.37%
Equatorial Energia	N/A	N/A	N/A

Valuation & Earnings

This table compares Entergy and Equatorial Energia”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Entergy	$12.07 billion	2.28	$2.36 billion	$9.97	12.90
Equatorial Energia	N/A	N/A	N/A	$0.25	26.80

Entergy has higher revenue and earnings than Equatorial Energia. Entergy 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

Entergy pays an annual dividend of $4.52 per share and has a dividend yield of 3.5%. Equatorial Energia pays an annual dividend of $0.07 per share and has a dividend yield of 1.1%. Entergy pays out 45.3% of its earnings in the form of a dividend. Equatorial Energia pays out 29.7% 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.

Analyst Ratings

This is a summary of current ratings for Entergy and Equatorial Energia, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Entergy	1	2	10	1	2.79
Equatorial Energia	0	0	0	0	N/A

Entergy presently has a consensus price target of $125.35, indicating a potential downside of 2.54%. Given Entergy’s higher possible upside, analysts clearly believe Entergy is more favorable than Equatorial Energia.

Institutional & Insider Ownership

88.1% of Entergy shares are held by institutional investors. Comparatively, 0.0% of Equatorial Energia shares are held by institutional investors. 0.4% of Entergy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Entergy beats Equatorial Energia on 11 of the 13 factors compared between the two stocks.

About Entergy

Entergy Corporation, together with its subsidiaries, engages in the production and retail distribution of electricity in the United States. It generates, transmits, distributes, and sells electric power in portions of Arkansas, Louisiana, Mississippi, and Texas, including the City of New Orleans; and distributes natural gas. It also engages in the ownership of interests in non-nuclear power plants that sell electric power to wholesale customers, as well as provides decommissioning services to other nuclear power plant owners. It generates electricity through gas, nuclear, coal, hydro, and solar power sources. The company sells energy to retail power providers, utilities, electric power co-operatives, power trading organizations, and other power generation companies. The company’s power plants have approximately 24,000 megawatts of electric generating capacity. It delivers electricity to 3 million utility customers in Arkansas, Louisiana, Mississippi, and Texas. Entergy Corporation was founded in 1913 and is headquartered in New Orleans, Louisiana.

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.