Analyzing AES (NYSE:AES) and American Power Group (OTCMKTS:APGI)

American Power Group (OTCMKTS:APGI) and AES (NYSE:AES) are both utilities companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Risk & Volatility

American Power Group has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500. Comparatively, AES has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for American Power Group and AES, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Power Group	0	0	0	0	0.00
AES	0	8	0	0	2.00

AES has a consensus target price of $15.71, suggesting a potential upside of 7.01%. Given AES’s stronger consensus rating and higher possible upside, analysts clearly believe AES is more favorable than American Power Group.

Institutional and Insider Ownership

93.1% of AES shares are owned by institutional investors. 75.8% of American Power Group shares are owned by company insiders. Comparatively, 0.8% of AES shares are owned 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 American Power Group and AES’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Power Group	N/A	N/A	N/A
AES	10.78%	22.66%	3.84%

Earnings and Valuation

This table compares American Power Group and AES”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Power Group	$2.13 million	6.63	-$1.71 million	N/A	N/A
AES	$12.23 billion	0.86	$910.00 million	$1.87	7.85

AES has higher revenue and earnings than American Power Group.

Summary

AES beats American Power Group on 9 of the 11 factors compared between the two stocks.

About American Power Group

American Power Group Corporation provides patented dual fuel conversion system for primary and back-up diesel generators, and mid-to heavy-duty vehicular diesel engines in North America and internationally. It operates through two segments, Dual Fuel Conversion Operations and Natural Gas Liquids Operations. The company's dual fuel conversion system is a fuel delivery enhancement system that converts existing diesel engines into engines, which run on diesel fuel and compressed natural gas or liquefied natural gas; diesel fuel and pipeline gas, well-head gas, or approved bio-methane; and diesel. It also provides flare capture and recovery services to oil and gas production companies. The company was formerly known as GreenMan Technologies, Inc. and changed its name to American Power Group Corporation in August 2012. American Power Group Corporation was founded in 1992 and is headquartered in Algona, Iowa.

About AES

The AES Corporation, together with its subsidiaries, operates as a diversified power generation and utility company in the United States and internationally. The company owns and/or operates power plants to generate and sell power to customers, such as utilities, industrial users, and other intermediaries; owns and/or operates utilities to generate or purchase, distribute, transmit, and sell electricity to end-user customers in the residential, commercial, industrial, and governmental sectors; and generates and sells electricity on the wholesale market. It uses various fuels and technologies to generate electricity, such as coal, gas, hydro, wind, solar, and biomass, as well as renewables comprising energy storage and landfill gas. The company owns and/or operates a generation portfolio of approximately 34,596 megawatts and distributes power to 2.6 million customers. The company was formerly known as Applied Energy Services, Inc. and changed its name to The AES Corporation in April 2000. The AES Corporation was incorporated in 1981 and is headquartered in Arlington, Virginia.