Spire (NYSE: SR) and South Jersey Industries (NYSE:SJI) are both mid-cap 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, dividends, risk, profitability and earnings.
Volatility and Risk
Spire has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500. Comparatively, South Jersey Industries has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.
This is a summary of current ratings and price targets for Spire and South Jersey Industries, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|South Jersey Industries||0||5||2||0||2.29|
Spire presently has a consensus price target of $69.00, indicating a potential downside of 4.56%. South Jersey Industries has a consensus price target of $32.80, indicating a potential upside of 16.48%. Given South Jersey Industries’ stronger consensus rating and higher probable upside, analysts clearly believe South Jersey Industries is more favorable than Spire.
Spire pays an annual dividend of $2.25 per share and has a dividend yield of 3.1%. South Jersey Industries pays an annual dividend of $1.12 per share and has a dividend yield of 4.0%. Spire pays out 63.2% of its earnings in the form of a dividend. South Jersey Industries pays out 91.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Insider and Institutional Ownership
82.9% of Spire shares are owned by institutional investors. Comparatively, 70.5% of South Jersey Industries shares are owned by institutional investors. 3.0% of Spire shares are owned by insiders. Comparatively, 0.6% of South Jersey Industries shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Spire and South Jersey Industries’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Spire||$1.74 billion||2.01||$161.60 million||$3.56||20.31|
|South Jersey Industries||$1.24 billion||1.80||-$3.49 million||$1.23||22.89|
Spire has higher revenue and earnings than South Jersey Industries. Spire is trading at a lower price-to-earnings ratio than South Jersey Industries, indicating that it is currently the more affordable of the two stocks.
This table compares Spire and South Jersey Industries’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|South Jersey Industries||-0.28%||7.84%||2.60%|
Spire beats South Jersey Industries on 11 of the 16 factors compared between the two stocks.
Spire Company Profile
Spire Inc., formerly The Laclede Group, Inc., is engaged to transform its business and pursue growth by growing its gas utility business through prudent investment in infrastructure upgrades and organic growth initiatives; acquire and integrate gas utilities; modernize its gas assets, and invest in innovation. The Company has two business segments, which include gas utility and gas marketing. The gas utility segment includes the regulated operations of Laclede Gas Company (Laclede Gas), Alabama Gas Corporation (Alagasco) and EnergySouth, Inc. (EnergySouth). The gas marketing segment includes Laclede Energy Resources, Inc. (LER), a subsidiary engaged in the marketing of natural gas and related activities on a non-regulated basis. Laclede Gas is engaged in the purchase, retail distribution and sale of natural gas, serving residential, commercial and industrial customers, through Missouri Gas Energy (MGE), Kansas City and western Missouri.
South Jersey Industries Company Profile
South Jersey Industries, Inc. (SJI) is an energy services holding company. The Company provides a range of energy-related products and services, primarily through its subsidiaries. Its subsidiaries include South Jersey Gas Company (SJG), South Jersey Energy Company (SJE), South Jersey Resources Group, LLC (SJRG), South Jersey Exploration, LLC (SJEX), Marina Energy, LLC (Marina), South Jersey Energy Service Plus, LLC (SJESP) and SJI Midstream, LLC (Midstream). Its segments include Gas utility operations (SJG), which consist primarily of natural gas distribution; Wholesale energy operations, which include the activities of SJRG and SJEX; SJE, which is involved in both retail gas and retail electric activities; On-Site energy production, which consists of Marina’s thermal energy facility; Appliance service operations, which include SJESP, and Corporate and Services segment, which includes the activities of Midstream.
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