Contrasting The AES Corporation (AES) & Its Peers

The AES Corporation (NYSE: AES) is one of 82 public companies in the “Electric Utilities” industry, but how does it weigh in compared to its rivals? We will compare The AES Corporation to similar businesses based on the strength of its valuation, profitability, analyst recommendations, institutional ownership, dividends, risk and earnings.

Profitability

This table compares The AES Corporation and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The AES Corporation -5.43% 15.14% 2.47%
The AES Corporation Competitors -6.35% 8.07% 2.55%

Volatility & Risk

The AES Corporation has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500. Comparatively, The AES Corporation’s rivals have a beta of 0.65, indicating that their average share price is 35% less volatile than the S&P 500.

Institutional and Insider Ownership

94.3% of The AES Corporation shares are held by institutional investors. Comparatively, 65.4% of shares of all “Electric Utilities” companies are held by institutional investors. 1.1% of The AES 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, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and recommmendations for The AES Corporation and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The AES Corporation 0 3 2 0 2.40
The AES Corporation Competitors 532 2953 2379 42 2.33

The AES Corporation presently has a consensus target price of $13.00, indicating a potential upside of 20.15%. As a group, “Electric Utilities” companies have a potential upside of 6.77%. Given The AES Corporation’s stronger consensus rating and higher probable upside, equities research analysts plainly believe The AES Corporation is more favorable than its rivals.

Valuation and Earnings

This table compares The AES Corporation and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
The AES Corporation $13.59 billion -$1.13 billion -9.25
The AES Corporation Competitors $7.66 billion $831.80 million 50.11

The AES Corporation has higher revenue, but lower earnings than its rivals. The AES Corporation is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Dividends

The AES Corporation pays an annual dividend of $0.48 per share and has a dividend yield of 4.4%. The AES Corporation pays out -41.0% 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 103.7% of their earnings in the form of a dividend. The AES Corporation has raised its dividend for 4 consecutive years. The AES Corporation is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Summary

The AES Corporation beats its rivals on 9 of the 15 factors compared.

About The AES Corporation

The AES Corporation is a holding company. The Company, through its subsidiaries and affiliates, operates a diversified portfolio of electricity generation and distribution businesses. It is organized into six strategic business units (SBUs): the United States; Andes; Brazil; Mexico, Central America and the Caribbean (MCAC); Europe, and Asia. As of December 31, 2016, its United States SBU had 18 generation facilities and two integrated utilities in the United States. As of December 31, 2016, its Andes SBU had generation facilities in three countries. Its Brazil SBU has generation and distribution businesses, Eletropaulo and Tiete. As of December 31, 2016, its MCAC SBU had a portfolio of distribution businesses and generation facilities, including renewable energy, in five countries. As of December 31, 2016, its Europe SBU had generation facilities in five countries. As of December 31, 2016, its Asia SBU had generation facilities in three countries.

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