AES (NYSE:AES – Get Free Report) and Companhia Paranaense de Energia (COPEL) (NYSE:ELP – Get Free Report) are both mid-cap utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.
Risk and Volatility
AES has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, Companhia Paranaense de Energia (COPEL) has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.
Profitability
This table compares AES and Companhia Paranaense de Energia (COPEL)’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| AES | 9.47% | 18.83% | 3.04% |
| Companhia Paranaense de Energia (COPEL) | 8.66% | 7.77% | 3.34% |
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| AES | $12.28 billion | 0.78 | $1.68 billion | $1.60 | 8.42 |
| Companhia Paranaense de Energia (COPEL) | $4.20 billion | 1.39 | $520.91 million | $0.12 | 81.88 |
AES has higher revenue and earnings than Companhia Paranaense de Energia (COPEL). AES is trading at a lower price-to-earnings ratio than Companhia Paranaense de Energia (COPEL), indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of current ratings and target prices for AES and Companhia Paranaense de Energia (COPEL), as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| AES | 1 | 4 | 7 | 0 | 2.50 |
| Companhia Paranaense de Energia (COPEL) | 0 | 1 | 0 | 0 | 2.00 |
AES presently has a consensus target price of $23.83, indicating a potential upside of 77.00%. Given AES’s stronger consensus rating and higher probable upside, research analysts clearly believe AES is more favorable than Companhia Paranaense de Energia (COPEL).
Insider & Institutional Ownership
93.1% of AES shares are held by institutional investors. Comparatively, 3.8% of Companhia Paranaense de Energia (COPEL) shares are held by institutional investors. 0.6% of AES shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Dividends
AES pays an annual dividend of $0.70 per share and has a dividend yield of 5.2%. Companhia Paranaense de Energia (COPEL) pays an annual dividend of $0.25 per share and has a dividend yield of 2.5%. AES pays out 43.8% of its earnings in the form of a dividend. Companhia Paranaense de Energia (COPEL) pays out 208.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AES has raised its dividend for 12 consecutive years. AES is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
AES beats Companhia Paranaense de Energia (COPEL) on 14 of the 17 factors compared between the two stocks.
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.
About Companhia Paranaense de Energia (COPEL)
Companhia Paranaense de Energia – COPEL engages in the generation, transformation, distribution, and sale of electricity to industrial, residential, commercial, rural, and other customers in Brazil. The company operates through Power Generation and Transmission, Power Distribution, Power Sale, and Gas segments. It is also involved in the piped natural gas distribution. The company operates hydroelectric, wind, and thermoelectric plants; and owns and operates transmission and distribution lines. It holds concessions to distribute electricity in municipalities in the State of Paraná and in the municipality of Porto União in the State of Santa Catarina. Companhia Paranaense de Energia COPEL was founded in 1954 and is headquartered in Curitiba, Brazil.Companhia Paranaense de Energia – COPEL Operates as a subsidiary of Governo Do Estado Do Parana.
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