Contrasting FirstEnergy (NYSE:FE) & WEC Energy Group (NYSE:WEC)

WEC Energy Group (NYSE:WEC) and FirstEnergy (NYSE:FE) are both large-cap utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Risk and Volatility

WEC Energy Group has a beta of 0.56, suggesting that its stock price is 44% less volatile than the S&P 500. Comparatively, FirstEnergy has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Dividends

WEC Energy Group pays an annual dividend of $3.57 per share and has a dividend yield of 3.4%. FirstEnergy pays an annual dividend of $1.78 per share and has a dividend yield of 4.0%. WEC Energy Group pays out 67.5% of its earnings in the form of a dividend. FirstEnergy pays out 77.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. WEC Energy Group has raised its dividend for 23 consecutive years and FirstEnergy has raised its dividend for 3 consecutive years.

Analyst Ratings

This is a breakdown of recent recommendations for WEC Energy Group and FirstEnergy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WEC Energy Group	2	6	5	2	2.47
FirstEnergy	0	6	7	1	2.64

WEC Energy Group presently has a consensus price target of $120.92, suggesting a potential upside of 15.35%. FirstEnergy has a consensus price target of $48.75, suggesting a potential upside of 9.69%. Given WEC Energy Group’s higher possible upside, equities analysts plainly believe WEC Energy Group is more favorable than FirstEnergy.

Insider and Institutional Ownership

77.2% of WEC Energy Group shares are held by institutional investors. Comparatively, 89.4% of FirstEnergy shares are held by institutional investors. 0.5% of WEC Energy Group shares are held by company insiders. Comparatively, 0.2% of FirstEnergy shares are held 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 WEC Energy Group and FirstEnergy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WEC Energy Group	17.75%	12.60%	3.50%
FirstEnergy	9.19%	11.15%	2.90%

Earnings and Valuation

This table compares WEC Energy Group and FirstEnergy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WEC Energy Group	$8.60 billion	3.97	$1.53 billion	$5.29	19.82
FirstEnergy	$13.47 billion	1.91	$978.00 million	$2.29	19.41

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

Summary

WEC Energy Group beats FirstEnergy on 12 of the 18 factors compared between the two stocks.

About WEC Energy Group

WEC Energy Group, Inc., through its subsidiaries, provides regulated natural gas and electricity, and renewable and nonregulated renewable energy services in the United States. It operates through Wisconsin, Illinois, Other States, Electric Transmission, and Non-Utility Energy Infrastructure segments. The company generates and distributes electricity from coal, natural gas, oil, and nuclear, as well as renewable energy resources, including wind, solar, hydroelectric, and biomass; and distributes and transports natural gas. It also owns, maintains, monitors, and operates electric transmission systems; and generates, distributes, and sells steam. As of December 31, 2023, the company operated approximately 35,500 miles of overhead distribution lines and 36,500 miles of underground distribution cables, as well as 430 electric distribution substations and 523,700 line transformers; approximately 46,400 miles of natural gas distribution mains; 1,700 miles of natural gas transmission mains; 2.4 million natural gas lateral services; 490 natural gas distribution and transmission gate stations; and 69.3 billion cubic feet of working gas capacities in underground natural gas storage fields. The company was formerly known as Wisconsin Energy Corporation and changed its name to WEC Energy Group, Inc. in June 2015. WEC Energy Group, Inc. was founded in 1896 and is headquartered in Milwaukee, Wisconsin.

About FirstEnergy

FirstEnergy Corp., through its subsidiaries, generates, transmits, and distributes electricity in the United States. It operates through Regulated Distribution and Regulated Transmission segments. The company owns and operates coal-fired, nuclear, hydroelectric, wind, and solar power generating facilities. It operates 24,080 circuit miles of overhead and underground transmission lines; and electric distribution systems, including 274,518 miles of overhead pole line and underground conduit carrying primary, secondary, and street lighting circuits. The company serves approximately 6 million customers in Ohio, Pennsylvania, West Virginia, Maryland, New Jersey, and New York. FirstEnergy Corp. was incorporated in 1996 and is headquartered in Akron, Ohio.