Reviewing Alliant Energy (LNT) and WEC Energy Group (WEC)

Alliant Energy (NYSE: LNT) and WEC Energy Group (NYSE:WEC) are both utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, profitability, risk, analyst recommendations, dividends and institutional ownership.

Profitability

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This table compares Alliant Energy and WEC Energy Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alliant Energy 13.82% 11.11% 3.26%
WEC Energy Group 15.75% 10.81% 3.24%

Volatility and Risk

Alliant Energy has a beta of 0.31, indicating that its share price is 69% less volatile than the S&P 500. Comparatively, WEC Energy Group has a beta of 0.07, indicating that its share price is 93% less volatile than the S&P 500.

Dividends

Alliant Energy pays an annual dividend of $1.34 per share and has a dividend yield of 3.3%. WEC Energy Group pays an annual dividend of $2.21 per share and has a dividend yield of 3.6%. Alliant Energy pays out 69.4% of its earnings in the form of a dividend. WEC Energy Group pays out 70.4% 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. Alliant Energy has increased its dividend for 12 consecutive years and WEC Energy Group has increased its dividend for 7 consecutive years.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alliant Energy $3.38 billion 2.77 $467.50 million $1.93 20.99
WEC Energy Group $7.65 billion 2.54 $1.20 billion $3.14 19.60

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

Institutional and Insider Ownership

69.9% of Alliant Energy shares are owned by institutional investors. Comparatively, 73.0% of WEC Energy Group shares are owned by institutional investors. 0.3% of Alliant Energy shares are owned by insiders. Comparatively, 1.0% of WEC Energy Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations for Alliant Energy and WEC Energy Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alliant Energy 0 5 0 0 2.00
WEC Energy Group 1 6 1 0 2.00

Alliant Energy currently has a consensus price target of $43.40, indicating a potential upside of 7.11%. WEC Energy Group has a consensus price target of $66.00, indicating a potential upside of 7.23%. Given WEC Energy Group’s higher possible upside, analysts plainly believe WEC Energy Group is more favorable than Alliant Energy.

Summary

WEC Energy Group beats Alliant Energy on 9 of the 16 factors compared between the two stocks.

Alliant Energy Company Profile

Alliant Energy Corporation operates as a regulated investor-owned public utility holding company. The Company’s segments include Utility and Non-regulated, Parent and Other. The Utility segment includes the operations of Interstate Power and Light Company (IPL) and Wisconsin Power and Light Company (WPL), which serve retail customers in Iowa and Wisconsin. The Utility segment includes utility electric operations, utility gas operations and utility other, which includes steam operations and the unallocated portions of the utility business. Its Non-regulated, Parent and Other segment includes the operations of Alliant Energy Resources, LLC and its subsidiaries; Alliant Energy Corporate Services, Inc. (Corporate Services); the Alliant Energy parent company, and any Alliant Energy parent company consolidating adjustments. IPL and WPL own a portfolio of electric generating units located in Iowa, Wisconsin and Minnesota with a fuel mix, including coal, natural gas and renewable resources.

WEC Energy Group Company Profile

WEC Energy Group, Inc. was a diversified holding company with natural gas and electric utility operations, an approximately 60% equity ownership interest in American Transmission Company LLC, and non-utility electric operations through its We Power business, as of December 31, 2016. Its segments include Wisconsin; Illinois; Other States; Electric Transmission; We Power, and Corporate and Other. Wisconsin includes the electric and natural gas utility operations of Wisconsin Electric Power Company, Wisconsin Gas LLC, and Wisconsin Public Service Corporation, including WE’s and WPS’s electric and natural gas operations in the state of Michigan. Illinois includes the natural gas utility and non-utility operations of The Peoples Gas Light and Coke Company and North Shore Gas Company. Other states includes the natural gas utility and non-utility operations of Minnesota Energy Resources Corporation and Michigan Gas Utilities Corporation.

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