Head to Head Contrast: RWE (OTCMKTS:RWEOY) & Exelon (NASDAQ:EXC)

Exelon (NASDAQ:EXC) and RWE (OTCMKTS:RWEOY) are both large-cap utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, risk, analyst recommendations and profitability.

Earnings & Valuation

This table compares Exelon and RWE”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Exelon	$25.94 billion	1.83	$2.77 billion	$2.57	17.83
RWE	$19.94 billion	2.37	$3.54 billion	$5.26	12.37

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

Institutional & Insider Ownership

80.9% of Exelon shares are held by institutional investors. 0.1% of Exelon shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Exelon has a beta of 0.24, suggesting that its share price is 76% less volatile than the S&P 500. Comparatively, RWE has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500.

Dividends

Exelon pays an annual dividend of $1.68 per share and has a dividend yield of 3.7%. RWE pays an annual dividend of $1.00 per share and has a dividend yield of 1.5%. Exelon pays out 65.4% of its earnings in the form of a dividend. RWE pays out 19.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Exelon has increased its dividend for 3 consecutive years. Exelon is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent ratings for Exelon and RWE, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Exelon	1	14	5	0	2.20
RWE	0	5	3	0	2.38

Exelon presently has a consensus price target of $48.33, suggesting a potential upside of 5.50%. Given Exelon’s higher probable upside, equities analysts clearly believe Exelon is more favorable than RWE.

Profitability

This table compares Exelon and RWE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Exelon	10.17%	9.75%	2.41%
RWE	21.25%	5.34%	2.10%

Summary

Exelon beats RWE on 10 of the 17 factors compared between the two stocks.

About Exelon

Exelon is a regulated energy delivery company that operates electric and natural gas utilities. Its businesses deliver energy to homes and businesses, maintain utility infrastructure, and provide related customer services. The company serves customers in Illinois, Pennsylvania, Maryland, Delaware, New Jersey, and the District of Columbia through utilities including ComEd, PECO, BGE, Pepco, Delmarva Power, and Atlantic City Electric. Exelon was formed in 2000 through the merger of PECO Energy and Unicom, then the parent of Commonwealth Edison.

About RWE

RWE AG is a German energy company headquartered in Essen. Founded in 1898 as Rheinisch-Westfälisches Elektrizitätswerk, it has evolved from a regional electricity supplier into an international power-generation and energy-trading business. The company develops and operates renewable energy projects, including offshore and onshore wind farms and solar facilities. Its portfolio also includes flexible generation, such as gas-fired power plants, as well as energy storage and electricity trading activities.