Head to Head Analysis: IDACORP (IDA) & Great Plains Energy (GXP)

IDACORP (NYSE: IDA) and Great Plains Energy (NYSE:GXP) are both mid-cap utilities companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.

Institutional & Insider Ownership

76.6% of IDACORP shares are held by institutional investors. Comparatively, 89.0% of Great Plains Energy shares are held by institutional investors. 0.7% of IDACORP shares are held by insiders. Comparatively, 0.4% of Great Plains Energy shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares IDACORP and Great Plains Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IDACORP 15.88% 9.62% 3.45%
Great Plains Energy -2.26% 5.52% 2.02%

Dividends

IDACORP pays an annual dividend of $2.36 per share and has a dividend yield of 2.7%. Great Plains Energy pays an annual dividend of $1.10 per share and has a dividend yield of 3.4%. IDACORP pays out 56.1% of its earnings in the form of a dividend. Great Plains Energy pays out 63.2% 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. IDACORP has raised its dividend for 6 consecutive years and Great Plains Energy has raised its dividend for 7 consecutive years. Great Plains Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares IDACORP and Great Plains Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
IDACORP $1.35 billion 3.24 $212.41 million $4.21 20.60
Great Plains Energy $2.71 billion 2.55 -$106.20 million $1.74 18.39

IDACORP has higher earnings, but lower revenue than Great Plains Energy. Great Plains Energy is trading at a lower price-to-earnings ratio than IDACORP, 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 IDACORP and Great Plains Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IDACORP 2 1 0 0 1.33
Great Plains Energy 0 2 5 0 2.71

IDACORP presently has a consensus price target of $82.50, suggesting a potential downside of 4.86%. Great Plains Energy has a consensus price target of $31.40, suggesting a potential downside of 1.84%. Given Great Plains Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Great Plains Energy is more favorable than IDACORP.

Risk and Volatility

IDACORP has a beta of 0.4, indicating that its stock price is 60% less volatile than the S&P 500. Comparatively, Great Plains Energy has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500.

Summary

IDACORP beats Great Plains Energy on 10 of the 17 factors compared between the two stocks.

IDACORP Company Profile

IDACORP, Inc., through its subsidiary, Idaho Power Company, engages in the generation, transmission, distribution, purchase, and sale of electric energy in the United States. It operates 17 hydroelectric generating plants located in southern Idaho and eastern Oregon, as well as 3 natural gas-fired plants in southern Idaho; and owns interests in 3 coal-fired steam electric generating plants located in Wyoming, Nevada, and Oregon. As of December 31, 2017, the company provided electric service to approximately 545,000 general business customers; and had a network of approximately 4,857 pole-miles of high-voltage transmission lines, 24 step-up transmission substations located at power plants, 24 transmission substations, 10 switching stations, and 223 energized distribution substations, as well as approximately 27,441 pole-miles of distribution lines. Its principal commercial and industrial customers are involved in food processing, electronics and general manufacturing, agriculture, health care, and winter recreation activities. The company, through its other subsidiaries, invests in housing and other real estate investments. IDACORP, Inc. was founded in 1915 and is headquartered in Boise, Idaho.

Great Plains Energy Company Profile

Great Plains Energy Incorporated, through its subsidiaries, generates, transmits, distributes, and sells electricity. It also provides regulated steam services in St. Joseph, Missouri. The company generates electricity using coal, nuclear, natural gas, oil, wind, solar, landfill gas, and hydroelectric resources. It has approximately 6,500 megawatts of generating capacity. The company sells electricity to approximately 867,100 customers in western Missouri and eastern Kansas, including approximately 764,200 residences and 100,400 commercial firms, as well as 2,500 industrials, municipalities, and other electric utilities. Great Plains Energy Incorporated was founded in 1919 and is headquartered in Kansas City, Missouri.

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