ONE Gas (NYSE: OGS) and Just Energy Group (NYSE:JE) are both utilities companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, earnings, valuation, institutional ownership and risk.

Risk and Volatility

ONE Gas has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500. Comparatively, Just Energy Group has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500.

Profitability

This table compares ONE Gas and Just Energy Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ONE Gas 10.12% 7.98% 3.14%
Just Energy Group 2.18% -117.41% 18.57%

Institutional and Insider Ownership

73.1% of ONE Gas shares are owned by institutional investors. Comparatively, 29.2% of Just Energy Group shares are owned by institutional investors. 1.5% of ONE Gas shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for ONE Gas and Just Energy Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ONE Gas 2 2 0 0 1.50
Just Energy Group 0 2 3 0 2.60

ONE Gas currently has a consensus price target of $64.00, indicating a potential downside of 13.49%. Just Energy Group has a consensus price target of $8.80, indicating a potential upside of 58.84%. Given Just Energy Group’s stronger consensus rating and higher possible upside, analysts plainly believe Just Energy Group is more favorable than ONE Gas.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
ONE Gas $1.50 billion 2.58 $427.06 million $2.87 25.78
Just Energy Group $2.96 billion 0.27 $167.04 million $0.05 110.80

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

Dividends

ONE Gas pays an annual dividend of $1.68 per share and has a dividend yield of 2.3%. Just Energy Group pays an annual dividend of $0.40 per share and has a dividend yield of 7.2%. ONE Gas pays out 58.5% of its earnings in the form of a dividend. Just Energy Group pays out 800.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

ONE Gas beats Just Energy Group on 9 of the 16 factors compared between the two stocks.

ONE Gas Company Profile

ONE Gas, Inc. is a regulated natural gas distribution utility in the United States. The Company provides natural gas distribution services. The Company distributes natural gas in Oklahoma, Kansas and Texas. The Company serves residential, commercial and industrial, transportation and wholesale and public authority customers. The Company’s natural gas distribution markets in terms of customers are Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita and Topeka, Kansas, and Austin and El Paso, Texas. As of December 31, 2016, its three divisions, Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, distribute natural gas to approximately 88%, 72% and 13% of the natural gas distribution customers in Oklahoma, Kansas and Texas, respectively. As of December 31, 2016, the Company had 50.4 billion cubic feet (Bcf) of natural gas storage capacity under lease with remaining terms ranging from 1 to 10 years and maximum allowable daily withdrawal capacity of approximately 1.3 Bcf.

Just Energy Group Company Profile

Just Energy Group Inc. (Just Energy) is an energy management solutions provider engaged in electricity, natural gas, solar and green energy. The Company’s segments include Consumer Energy and Commercial Energy. The Company operates in the United States, Canada and the United Kingdom, offering a range of energy products, including long-term fixed-price, variable rate and flat bill programs; home energy management services, including smart thermostats and tools to manage energy use at the appliance level, and residential solar panel installations. It markets under the brands, such as Just Energy, Hudson Energy, Amigo Energy, GreenStar Energy, Just Solar, Tara Energy and TerraPass. Just Energy’s commercial business is operated primarily through Hudson Energy. Hudson Energy offers fixed and variable rate natural gas and electricity contracts, as well as customized products. Just Energy also offers green products through its JustGreen Electricity and Natural Gas and TerraPass programs.

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