Otter Tail (NASDAQ:OTTR) and Eversource Energy (NYSE:ES) Head to Head Survey

Eversource Energy (NYSE:ES) and Otter Tail (NASDAQ:OTTR) are both utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Dividends

Eversource Energy pays an annual dividend of $3.15 per share and has a dividend yield of 4.4%. Otter Tail pays an annual dividend of $2.31 per share and has a dividend yield of 3.0%. Eversource Energy pays out 83.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Otter Tail pays out 55.1% of its earnings in the form of a dividend. Eversource Energy has increased its dividend for 2 consecutive years and Otter Tail has increased its dividend for 12 consecutive years.

Earnings and Valuation

This table compares Eversource Energy and Otter Tail”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eversource Energy	$13.55 billion	1.97	$1.69 billion	$3.79	18.69
Otter Tail	$1.31 billion	2.49	$275.89 million	$4.19	18.51

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

Institutional and Insider Ownership

80.0% of Eversource Energy shares are held by institutional investors. Comparatively, 61.3% of Otter Tail shares are held by institutional investors. 0.2% of Eversource Energy shares are held by insiders. Comparatively, 2.0% of Otter Tail shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Eversource Energy and Otter Tail’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eversource Energy	10.38%	10.67%	2.75%
Otter Tail	13.45%	13.41%	6.04%

Analyst Recommendations

This is a breakdown of recent ratings for Eversource Energy and Otter Tail, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eversource Energy	3	7	4	0	2.07
Otter Tail	1	3	1	0	2.00

Eversource Energy presently has a consensus price target of $73.17, suggesting a potential upside of 3.31%. Otter Tail has a consensus price target of $91.00, suggesting a potential upside of 17.35%. Given Otter Tail’s higher probable upside, analysts clearly believe Otter Tail is more favorable than Eversource Energy.

Risk & Volatility

Eversource Energy has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, Otter Tail has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500.

Summary

Otter Tail beats Eversource Energy on 9 of the 17 factors compared between the two stocks.

About Eversource Energy

Eversource Energy is a public utility holding company that delivers electricity and natural gas to customers in New England. Its businesses include electric transmission and distribution, natural gas distribution, and related energy services. The company serves customers in Connecticut, Massachusetts, and New Hampshire through local utility subsidiaries. Its operations include maintaining and upgrading the networks used to deliver energy to homes and businesses. Eversource traces its history to Northeast Utilities, which adopted the Eversource Energy name in 2015 after combining with NSTAR.

About Otter Tail

Otter Tail Corporation is a diversified company based in Fergus Falls, Minnesota. Its businesses operate in the electric utility, manufacturing and plastics industries. Through Otter Tail Power Company, the corporation generates, transmits and distributes electricity to customers in parts of Minnesota, North Dakota and South Dakota. The utility traces its history to 1907. Its other businesses manufacture products such as metal components and fabricated assemblies, as well as plastic products for commercial and industrial applications.