MGE Energy (NASDAQ:MGEE) and Genie Energy (NYSE:GNE) Critical Analysis

MGE Energy (NASDAQ:MGEE) and Genie Energy (NYSE:GNE) are both utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Profitability

This table compares MGE Energy and Genie Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MGE Energy	18.27%	10.60%	4.59%
Genie Energy	1.00%	4.47%	2.16%

Valuation & Earnings

This table compares MGE Energy and Genie Energy”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MGE Energy	$743.65 million	3.78	$135.89 million	$3.72	20.67
Genie Energy	$425.20 million	0.86	$12.59 million	$0.80	17.34

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

Dividends

MGE Energy pays an annual dividend of $1.90 per share and has a dividend yield of 2.5%. Genie Energy pays an annual dividend of $0.30 per share and has a dividend yield of 2.2%. MGE Energy pays out 51.1% of its earnings in the form of a dividend. Genie Energy pays out 37.5% 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. MGE Energy has raised its dividend for 49 consecutive years. MGE Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

52.6% of MGE Energy shares are owned by institutional investors. Comparatively, 49.2% of Genie Energy shares are owned by institutional investors. 0.2% of MGE Energy shares are owned by insiders. Comparatively, 17.4% of Genie Energy shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds 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 MGE Energy and Genie Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MGE Energy	1	2	0	0	1.67
Genie Energy	0	1	0	0	2.00

MGE Energy currently has a consensus target price of $78.00, indicating a potential upside of 1.46%. Given MGE Energy’s higher probable upside, equities research analysts plainly believe MGE Energy is more favorable than Genie Energy.

Volatility & Risk

MGE Energy has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500. Comparatively, Genie Energy has a beta of 0.11, meaning that its stock price is 89% less volatile than the S&P 500.

Summary

MGE Energy beats Genie Energy on 13 of the 16 factors compared between the two stocks.

About MGE Energy

MGE Energy, Inc., through its subsidiaries, operates as a public utility holding company primarily in the United States. It operates through Regulated Electric Utility Operations; Regulated Gas Utility Operations; Nonregulated Energy Operations; Transmission Investments; and All Other segments. The company generates, purchases, and distributes electricity and natural gas in Wisconsin and Iowa; owns and leases electric generating capacity; and plans, constructs, operates, maintains, and expands transmission facilities to provide transmission power services. It generates electricity from coal-fired, gas-fired, and renewable energy sources. As of December 31, 2023, the company owned and operated 835 miles of overhead electric distribution lines; 1,330 miles of underground electric distribution cables; 49 substations with an installed capacity of 1.2 million kVA; and gas facilities, including 3,066 miles of distribution mains, as well as supplied electric service to approximately 163,000 customers. MGE Energy, Inc. founded in 2001 and is headquartered in Madison, Wisconsin.

About Genie Energy

Genie Energy Ltd., through its subsidiaries, engages in the supply of electricity and natural gas to residential and small business customers in the United States and internationally. It operates in two segments, GRE and Genie Renewables. The company also develops, constructs, and operates solar energy projects for commercial and industrial customers, as well as its own portfolio; provides energy brokerage and advisory services; markets community solar energy solutions; and manufactures and distributes solar panel, as well as engages in solar installation design and project management activities. Genie Energy Ltd. was incorporated in 2011 and is headquartered in Newark, New Jersey.