Financial Survey: Talen Energy (NASDAQ:TLN) & Gevo (NASDAQ:GEVO)

Gevo (NASDAQ:GEVO) and Talen Energy (NASDAQ:TLN) are both energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Insider & Institutional Ownership

35.2% of Gevo shares are held by institutional investors. Comparatively, 0.4% of Talen Energy shares are held by institutional investors. 7.1% of Gevo shares are held by insiders. Comparatively, 0.8% of Talen Energy shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

Gevo has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500. Comparatively, Talen Energy has a beta of 1.82, suggesting that its stock price is 82% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Gevo and Talen Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gevo	1	2	2	0	2.20
Talen Energy	0	4	10	0	2.71

Gevo presently has a consensus target price of $2.75, indicating a potential upside of 81.52%. Talen Energy has a consensus target price of $470.75, indicating a potential upside of 21.42%. Given Gevo’s higher possible upside, analysts plainly believe Gevo is more favorable than Talen Energy.

Profitability

This table compares Gevo and Talen Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gevo	-19.38%	-5.06%	-3.41%
Talen Energy	-0.63%	41.58%	6.00%

Valuation and Earnings

This table compares Gevo and Talen Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gevo	$174.42 million	2.11	-$33.84 million	($0.13)	-11.65
Talen Energy	$3.24 billion	5.74	-$219.00 million	($0.67)	-578.65

Gevo has higher earnings, but lower revenue than Talen Energy. Talen Energy is trading at a lower price-to-earnings ratio than Gevo, indicating that it is currently the more affordable of the two stocks.

Summary

Talen Energy beats Gevo on 8 of the 14 factors compared between the two stocks.

About Gevo

Gevo, Inc. operates as a carbon abatement company. It operates through three segments: Gevo, Agri-Energy, and Renewable Natural Gas. The company focuses on transforming renewable energy into energy-dense liquid hydrocarbons that can be used as renewable fuels. It offers renewable gasoline and diesel, isobutanol, sustainable aviation fuel, renewable natural gas, isobutylene, ethanol, and animal feed and protein. The company was formerly known as Methanotech, Inc. and changed its name to Gevo, Inc. in March 2006. Gevo, Inc. was incorporated in 2005 and is headquartered in Englewood, Colorado.

About Talen Energy

Talen Energy Corporation is a U.S.-based energy and power generation company. The Company owns or controls approximately 16,000 megawatts of capacity in wholesale power markets, principally in the Northeast, Mid-Atlantic and Southwest regions of the United States. The Company generates and sells electricity, capacity and related products from power plants that use fuel sources, such as nuclear, natural gas and coal. The Company’s Susquehanna nuclear power plant has approximately two boiling water reactors with a combined capacity of over 2,600 megawatts. Its fossil fuel plants are located in Athens, Barney Davis, Bayonne, Brandon Shores, Brunner Island, Camden, Colstrip and Dartmouth, among others. It has an art energy trading center located in Allentown, Pennsylvania (PA), where it manages asset load obligations, fuel supply, capacity and related products, and all supporting physical or financial transactions for its electric generation portfolio.