Huaneng Power International (HNP) & Avangrid (AGR) Head to Head Comparison


Huaneng Power International (NYSE: HNP) and Avangrid (NYSE:AGR) are both large-cap utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Volatility & Risk

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Huaneng Power International has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500. Comparatively, Avangrid has a beta of 0.17, meaning that its stock price is 83% less volatile than the S&P 500.

Valuation & Earnings

This table compares Huaneng Power International and Avangrid’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Huaneng Power International $22.56 billion 0.45 $233.81 million $0.40 67.15
Avangrid $5.96 billion 2.69 $381.00 million $2.20 23.58

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

Dividends

Huaneng Power International pays an annual dividend of $0.55 per share and has a dividend yield of 2.0%. Avangrid pays an annual dividend of $1.73 per share and has a dividend yield of 3.3%. Huaneng Power International pays out 137.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Avangrid pays out 78.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Avangrid is clearly the better dividend stock, given its higher yield and lower payout ratio.


Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Huaneng Power International and Avangrid, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Huaneng Power International 0 1 2 0 2.67
Avangrid 1 1 7 0 2.67

Avangrid has a consensus price target of $52.21, suggesting a potential upside of 0.64%. Given Avangrid’s higher probable upside, analysts clearly believe Avangrid is more favorable than Huaneng Power International.


Insider & Institutional Ownership

0.5% of Huaneng Power International shares are owned by institutional investors. Comparatively, 14.2% of Avangrid shares are owned by institutional investors. 0.4% of Avangrid shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Huaneng Power International and Avangrid’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Huaneng Power International 1.03% 1.66% 0.43%
Avangrid 6.36% 4.59% 2.21%

Summary

Avangrid beats Huaneng Power International on 12 of the 15 factors compared between the two stocks.

Huaneng Power International Company Profile

Huaneng Power International, Inc., through its subsidiaries, generates and sells electricity and heat to the regional or provincial grid companies in the People's Republic of China and Singapore. It is involved in the development, investment, construction, operation, and management of power plants and related projects; and generation, wholesale, and retail of power and other relating utilities. The company generates power from coal, wind, gas, oil, biomass, solar, and hydro resources. It is also involved in the sale of coal ash and lime; provision of loading warehousing and conveying services; photovoltaic power generation projects development and construction; and provision of thermal energy and cold energy services, as well as thermal heating services. In addition, the company engages in the repair of power equipment; provision of water supply and transportation services; construction and operation of electricity distribution networks and heating pipe networks; power supply, energy transmission, and substation project contracting activities; cargo transportation along domestic coastal areas; port management, investment, and development activities; and port provision, and cargo loading and storage activities. Further, it is involved in the aquaculture and agriculture irrigation activities, as well as provides environment engineering, waste recycling consultancy, and industrial waste management and recycling services. Additionally, it sells raw and processed coal; and provides central heat, and plumbing and pipe installation services, as well as desalinated water. As of March 31, 2018, the company had controlled generating capacity of 104,301 megawatts and a total generating capacity of 91,783 megawatts. Huaneng Power International, Inc. was founded in 1994 and is headquartered in Beijing, the People's Republic of China.


Avangrid Company Profile

Avangrid, Inc. operates as an energy services holding company in the United States. It engages in the generation, transmission, and distribution of electricity, as well as distribution, transportation, and sale of natural gas. As of December 31, 2017, the company delivered electricity to approximately 2.2 million electric utility customers, as well as natural gas to approximately 1 million natural gas public utility customers; and owned approximately 67.5 billion cubic feet of net working gas storage capacity. It also develops, constructs, and operates renewable energy generation facilities primarily using onshore wind power, as well as solar, biomass, and thermal power. The company delivers natural gas and electricity to residential, commercial, and institutional customers through its regulated utilities in New York, Maine, Connecticut, and Massachusetts; and sells its output to investor-owned utilities, public utilities, and other credit-worthy entities. It also generates and provides power and other services to federal and state agencies, as well as institutional retail and joint action agencies; and delivers thermal output to wholesale customers in the Western United States. The company was formerly known as Iberdrola USA, Inc. Avangrid, Inc. was founded in 1852 and is headquartered in Orange, Connecticut. Avangrid, Inc. is a subsidiary of Iberdrola, S.A.

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