Analyzing Power Assets (OTCMKTS:HGKGY) and Avista (NYSE:AVA)

Power Assets (OTCMKTS:HGKGY) and Avista (NYSE:AVA) are both utilities companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, earnings and institutional ownership.

Dividends

Power Assets pays an annual dividend of $0.32 per share and has a dividend yield of 4.0%. Avista pays an annual dividend of $1.97 per share and has a dividend yield of 4.8%. Avista pays out 78.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Avista has increased its dividend for 23 consecutive years. Avista is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Power Assets has a beta of 0.33, meaning that its stock price is 67% less volatile than the S&P 500. Comparatively, Avista has a beta of 0.24, meaning that its stock price is 76% less volatile than the S&P 500.

Profitability

This table compares Power Assets and Avista’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Power Assets	N/A	N/A	N/A
Avista	10.75%	7.65%	2.50%

Earnings and Valuation

This table compares Power Assets and Avista”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Power Assets	$98.89 million	173.01	$800.08 million	N/A	N/A
Avista	$1.96 billion	1.74	$193.00 million	$2.51	16.52

Power Assets has higher earnings, but lower revenue than Avista.

Analyst Ratings

This is a summary of recent recommendations and price targets for Power Assets and Avista, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Power Assets	0	0	0	0	0.00
Avista	1	5	1	0	2.00

Avista has a consensus target price of $40.00, suggesting a potential downside of 3.54%. Given Avista’s stronger consensus rating and higher probable upside, analysts plainly believe Avista is more favorable than Power Assets.

Insider & Institutional Ownership

85.2% of Avista shares are held by institutional investors. 1.0% of Power Assets shares are held by insiders. Comparatively, 0.8% of Avista shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Avista beats Power Assets on 10 of the 15 factors compared between the two stocks.

About Power Assets

Power Assets Holdings Limited, an investment holding company, engages in the generation, transmission, and distribution of electricity in Hong Kong, the United Kingdom, Australia, Mainland China, and internationally. It generates energy from thermal, renewable energy, and waste sources. The company also transmits and distributes oil and gas; and provides trust administration and management services. It has a generation capacity of 879 MW renewable energy/energy from waste, 5,262 MW gas fired, and 3,567 MW coal/oil fired; and operates 114,900 km of gas/oil pipeline, as well as 388,200 km of power network serving 19,790,000 customers. The company was formerly known as Hongkong Electric Holdings Limited and changed its name to Power Assets Holdings Limited in February 2011. Power Assets Holdings Limited was founded in 1889 and is based in Central, Hong Kong.

About Avista

Avista Corporation, together with its subsidiaries, operates as an electric and natural gas utility company. It operates in two segments, Avista Utilities and AEL&P. The Avista Utilities segment provides electric distribution and transmission, and natural gas distribution services in parts of eastern Washington and northern Idaho; and natural gas distribution services in parts of northeastern and southwestern Oregon, as well as generates electricity in Washington, Idaho, Oregon, and Montana. This segment also engages in the supply of electricity to customers in Montana; and wholesale purchase and sale of electricity and natural gas. The AEL&P segment offers electric services in Juneau, Alaska. The company generates electricity through hydroelectric, thermal, wind, and solar generation facilities. As of December 31, 2023, it supplied retail electric services to approximately 416,000 customers; and retail natural gas services to approximately 381,000 customers. The company also operates five hydroelectric generation facilities with capacity of 102.7 MW; and four diesel generating facilities with a capacity of 107.5 MW. It also engages in venture fund investments, real estate investments, and other investments. Avista Corporation was incorporated in 1889 and is headquartered in Spokane, Washington.