Pinnacle West Capital Corporation (NYSE: PNW) is one of 82 publicly-traded companies in the “Electric Utilities” industry, but how does it weigh in compared to its peers? We will compare Pinnacle West Capital Corporation to related companies based on the strength of its risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.

Profitability

This table compares Pinnacle West Capital Corporation and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pinnacle West Capital Corporation 14.67% 10.31% 3.16%
Pinnacle West Capital Corporation Competitors -6.54% 9.46% 2.64%

Dividends

Pinnacle West Capital Corporation pays an annual dividend of $2.78 per share and has a dividend yield of 3.1%. Pinnacle West Capital Corporation pays out 60.0% of its earnings in the form of a dividend. As a group, “Electric Utilities” companies pay a dividend yield of 3.2% and pay out 103.8% of their earnings in the form of a dividend. Pinnacle West Capital Corporation has increased its dividend for 5 consecutive years.

Earnings and Valuation

This table compares Pinnacle West Capital Corporation and its peers gross revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Pinnacle West Capital Corporation $3.50 billion $442.03 million 19.45
Pinnacle West Capital Corporation Competitors $7.66 billion $831.80 million 49.22

Pinnacle West Capital Corporation’s peers have higher revenue and earnings than Pinnacle West Capital Corporation. Pinnacle West Capital Corporation is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Risk and Volatility

Pinnacle West Capital Corporation has a beta of 0.38, meaning that its share price is 62% less volatile than the S&P 500. Comparatively, Pinnacle West Capital Corporation’s peers have a beta of 0.66, meaning that their average share price is 34% less volatile than the S&P 500.

Institutional & Insider Ownership

85.2% of Pinnacle West Capital Corporation shares are held by institutional investors. Comparatively, 65.7% of shares of all “Electric Utilities” companies are held by institutional investors. 0.7% of Pinnacle West Capital Corporation shares are held by insiders. Comparatively, 2.7% of shares of all “Electric Utilities” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for Pinnacle West Capital Corporation and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pinnacle West Capital Corporation 1 9 0 0 1.90
Pinnacle West Capital Corporation Competitors 534 2960 2385 42 2.33

Pinnacle West Capital Corporation presently has a consensus target price of $85.00, suggesting a potential downside of 5.61%. As a group, “Electric Utilities” companies have a potential upside of 7.20%. Given Pinnacle West Capital Corporation’s peers stronger consensus rating and higher possible upside, analysts clearly believe Pinnacle West Capital Corporation has less favorable growth aspects than its peers.

Summary

Pinnacle West Capital Corporation peers beat Pinnacle West Capital Corporation on 10 of the 15 factors compared.

Pinnacle West Capital Corporation Company Profile

Pinnacle West Capital Corporation is a holding company that operates through its subsidiaries. The Company operates through regulated electricity segment, which consists of traditional regulated retail and wholesale electricity businesses and related activities, and includes electricity generation, transmission and distribution. It owned and leased 6,236 megawatt (MW) of regulated generation capacity and the Company held a mix of both long-term and short-term purchased power agreements for additional capacity, including agreements for the purchase of renewable energy, as of December 31, 2016. Its subsidiaries include Arizona Public Service Company, which is a vertically-integrated electric utility that provides retail or wholesale electric service to the State of Arizona, with the exceptions of about one-half of the Phoenix metropolitan area, the Tucson metropolitan area and Mohave County in northwestern Arizona.

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