Edison International (EIX) versus Enel S.p.A. ADS (ENLAY) Financial Review

Edison International (NYSE:EIX) and Enel S.p.A. ADS (OTCMKTS:ENLAY) are both large-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, risk, valuation, profitability, earnings, institutional ownership and dividends.

Risk and Volatility

Edison International has a beta of -0.06, indicating that its share price is 106% less volatile than the S&P 500. Comparatively, Enel S.p.A. ADS has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500.

Profitability

This table compares Edison International and Enel S.p.A. ADS’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Edison International -2.45% 10.47% 2.67%
Enel S.p.A. ADS 5.52% 8.62% 2.61%

Institutional & Insider Ownership

84.8% of Edison International shares are owned by institutional investors. Comparatively, 0.1% of Enel S.p.A. ADS shares are owned by institutional investors. 0.4% of Edison International shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Edison International and Enel S.p.A. ADS, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Edison International 1 5 5 0 2.36
Enel S.p.A. ADS 1 1 2 0 2.25

Edison International currently has a consensus price target of $70.25, suggesting a potential upside of 11.35%. Given Edison International’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Edison International is more favorable than Enel S.p.A. ADS.

Valuation & Earnings

This table compares Edison International and Enel S.p.A. ADS’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Edison International $12.66 billion 1.62 -$302.00 million $4.15 15.20
Enel S.p.A. ADS $84.31 billion 0.74 $4.27 billion N/A N/A

Enel S.p.A. ADS has higher revenue and earnings than Edison International.

Dividends

Edison International pays an annual dividend of $2.45 per share and has a dividend yield of 3.9%. Enel S.p.A. ADS pays an annual dividend of $0.18 per share and has a dividend yield of 2.9%. Edison International pays out 59.0% of its earnings in the form of a dividend. Edison International has increased its dividend for 14 consecutive years. Edison International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Edison International beats Enel S.p.A. ADS on 11 of the 16 factors compared between the two stocks.

Edison International Company Profile

Edison International, through its subsidiaries, engages in the generation, transmission, and distribution of electricity in the United States. It generates electricity through hydroelectric, diesel/liquid petroleum gas, natural gas, nuclear, and photovoltaic sources. The company supplies electricity primarily to residential, commercial, industrial, agricultural, and other customers, as well as public authorities through transmission and distribution networks. Its transmission facilities consist of lines ranging from 33 kV to 500 kV and substations; and distribution system comprises approximately 53,000 line miles of overhead lines, 38,000 line miles of underground lines, and 800 substations located in California. The company serves approximately 5 million customers. Edison International was founded in 1886 and is based in Rosemead, California.

Enel S.p.A. ADS Company Profile

Enel SpA, together with its subsidiaries, operates as an integrated electricity and gas company in South America, Europe, North and Central America, Africa, and Asia. The company generates, transmits, distributes, transports, purchases, and sells electricity; generates heat; and produces distributes, transports, and sells natural gas. It also engages in the transportation, storage, and regasification of liquefied natural gas (LNG); energy and infrastructure engineering; the design, development, construction, and operation of generation plants and grids; security and real estate activities; the management and maintenance of power plants; research and development in science and engineering; fuel supply; research and testing, inspection, certification, and engineering and consulting activities; and business consulting, administrative, management consulting, and corporate planning operations. In addition, the company is involved in the construction of electric facilities and port infrastructure; product, plant, and equipment certification; legal, trading, and mining activities; the marketing of energy products; training activities; personnel administration activities, as well as offers information technology and business services; and metering, remote control, and connectivity services through power line communication. Further, it designs, constructs, and operates merchant lines; operates optical fiber network; offers public lighting systems, fuel trading and logistics, factoring, electrical engineering, and water systems, and photovoltaic systems; and provides finance, environmental studies, and electronic plant installation and repairing services. It operates various hydroelectric, wind, renewable, geothermal, solar, thermoelectric, nuclear, and other renewable sources, and co-generation power plants with an installed capacity of approximately 85 gigawatts. The company was founded in 1962 and is headquartered in Rome, Italy.

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