Head-To-Head Analysis: Southwest Gas (NYSE:SWX) vs. Its Competitors

Southwest Gas (NYSE: SWX) is one of 14 public companies in the “Natural Gas Distribution” industry, but how does it compare to its peers? We will compare Southwest Gas to related companies based on the strength of its risk, dividends, valuation, earnings, analyst recommendations, profitability and institutional ownership.

Profitability

This table compares Southwest Gas and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Southwest Gas 6.64% 9.56% 2.87%
Southwest Gas Competitors 4.34% -11.14% 3.64%

Volatility and Risk

Southwest Gas has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500. Comparatively, Southwest Gas’ peers have a beta of 0.46, indicating that their average stock price is 54% less volatile than the S&P 500.

Insider and Institutional Ownership

77.5% of Southwest Gas shares are held by institutional investors. Comparatively, 65.8% of shares of all “Natural Gas Distribution” companies are held by institutional investors. 1.0% of Southwest Gas shares are held by company insiders. Comparatively, 2.2% of shares of all “Natural Gas Distribution” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Southwest Gas pays an annual dividend of $1.98 per share and has a dividend yield of 2.4%. Southwest Gas pays out 58.2% of its earnings in the form of a dividend. As a group, “Natural Gas Distribution” companies pay a dividend yield of 2.4% and pay out 64.6% of their earnings in the form of a dividend. Southwest Gas has raised its dividend for 5 consecutive years.

Analyst Ratings

This is a breakdown of current recommendations for Southwest Gas and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Southwest Gas 0 4 0 0 2.00
Southwest Gas Competitors 59 212 229 5 2.36

Southwest Gas presently has a consensus target price of $80.00, indicating a potential downside of 3.31%. As a group, “Natural Gas Distribution” companies have a potential downside of 0.29%. Given Southwest Gas’ peers stronger consensus rating and higher possible upside, analysts clearly believe Southwest Gas has less favorable growth aspects than its peers.

Earnings and Valuation

This table compares Southwest Gas and its peers gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Southwest Gas $2.46 billion $152.04 million 24.34
Southwest Gas Competitors $2.09 billion $171.32 million 23.48

Southwest Gas has higher revenue, but lower earnings than its peers. Southwest Gas is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Southwest Gas peers beat Southwest Gas on 8 of the 15 factors compared.

About Southwest Gas

Southwest Gas Holdings, Inc., formerly Southwest Gas Corporation, is engaged in the business of purchasing, distributing and transporting natural gas. The Company operates through two segments: natural gas operations and construction services, which includes the operations of the Company’s subsidiary, Centuri Construction Group, Inc. (Centuri). The Company operates two pipeline transmission systems, such as a system, which includes a liquefied natural gas (LNG) storage facility owned by Paiute extending from the Idaho-Nevada border to the Reno, Sparks, and Carson City areas and communities in the Lake Tahoe area in both California and Nevada and other communities in northern and western Nevada, and a system extending from the Colorado River at the southern tip of Nevada to the Las Vegas distribution area.

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