Head-To-Head Review: Dominion Energy (NYSE:D) and Vistra Energy (NYSE:VST)

Dominion Energy (NYSE:D) and Vistra Energy (NYSE:VST) are both large-cap utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, risk and valuation.

Profitability

This table compares Dominion Energy and Vistra Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dominion Energy 9.19% 12.35% 3.32%
Vistra Energy 4.22% 4.37% 1.37%

Volatility and Risk

Dominion Energy has a beta of 0.27, suggesting that its stock price is 73% less volatile than the S&P 500. Comparatively, Vistra Energy has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Dominion Energy $13.37 billion 4.61 $2.45 billion $4.05 18.98
Vistra Energy $9.14 billion 1.15 -$54.00 million ($0.02) -1,091.50

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Dominion Energy and Vistra Energy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dominion Energy 0 10 4 0 2.29
Vistra Energy 0 1 7 0 2.88

Dominion Energy currently has a consensus target price of $85.75, suggesting a potential upside of 11.58%. Vistra Energy has a consensus target price of $33.29, suggesting a potential upside of 52.48%. Given Vistra Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Vistra Energy is more favorable than Dominion Energy.

Insider & Institutional Ownership

63.8% of Dominion Energy shares are owned by institutional investors. 0.3% of Dominion Energy shares are owned by company insiders. Comparatively, 14.1% of Vistra Energy shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Dominion Energy pays an annual dividend of $3.67 per share and has a dividend yield of 4.8%. Vistra Energy pays an annual dividend of $0.50 per share and has a dividend yield of 2.3%. Dominion Energy pays out 90.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Vistra Energy pays out -2,500.0% of its earnings in the form of a dividend. Dominion Energy has increased its dividend for 10 consecutive years. Dominion Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Dominion Energy beats Vistra Energy on 11 of the 17 factors compared between the two stocks.

Dominion Energy Company Profile

Dominion Energy, Inc. produces and transports energy. The company's Power Delivery segment engages in the regulated electric transmission and distribution operations that serve residential, commercial, industrial, and governmental customers in Virginia and North Carolina. Its Power Generation segment is involved in the electricity generation activities. It also comprises generation operations of the company's merchant fleet and energy marketing, and price risk management activities for its assets. The company's Gas Infrastructure segment engages in the regulated natural gas distribution, gas transmission pipeline and storage, liquefied natural gas, and nonregulated retail natural gas marketing operations, as well as natural gas gathering and processing activities. This segment serves residential, commercial, and industrial customers. The company's Southeast Energy segment generates, transmits, distributes, and markets electricity and natural gas through South Carolina Electric & Gas Company and Public Service Company of North Carolina. As of December 31, 2018, the company's portfolio of assets included approximately 26,000 megawatts of generating capacity; 6,700 miles of electric transmission lines; 58,300 miles of electric distribution lines; 14,800 miles of natural gas transmission, gathering, and storage pipelines; and 52,300 miles of gas distribution pipelines. It served approximately 5 million utility and retail energy customers; and operated underground natural gas storage systems with approximately 1 trillion cubic feet of storage capacity. The company sells electricity at wholesale prices to rural electric cooperatives and municipalities, as well as into wholesale electricity markets. The company was formerly known as Dominion Resources, Inc. and changed its name to Dominion Energy, Inc. in May 2017. Dominion Energy, Inc. was founded in 1909 and is headquartered in Richmond, Virginia.

Vistra Energy Company Profile

Vistra Energy Corp., through its subsidiaries, engages in the integrated power business in Texas. The company operates through Wholesale Generation and Retail Electricity segments. The Wholesale Generation segment engages in the electricity generation, wholesale energy sales and purchases, commodity risk management, fuel production, and fuel logistics management activities. As of February 26, 2018, this segment had a fleet of generation facilities totaling approximately 14,000 megawatts of generation in Texas, including 2,300 megawatts fueled by nuclear power, 4,000 megawatts fueled by coal, and 7,500 megawatts fueled by natural gas. The Retail Electricity segment is involved in the retail sale of electricity and related services to residential, commercial, and industrial customers under the TXU Energy brand. This segment served approximately 1.7 million residential and business customers. The company was formerly known as TCEH Corp. and changed its name to Vistra Energy Corp. in November 2016. The company is based in Irving, Texas.

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