Financial Contrast: Pampa Energia (NYSE:PAM) versus NRG Energy (NYSE:NRG)

Pampa Energia (NYSE:PAM) and NRG Energy (NYSE:NRG) are both utilities companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Profitability

This table compares Pampa Energia and NRG Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pampa Energia 19.77% 11.58% 4.92%
NRG Energy 42.14% -15,555.52% 8.83%

Earnings and Valuation

This table compares Pampa Energia and NRG Energy’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pampa Energia $2.84 billion 0.24 $692.00 million $9.50 1.15
NRG Energy $9.82 billion 0.84 $4.44 billion $3.96 8.54

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

Institutional and Insider Ownership

34.6% of Pampa Energia shares are owned by institutional investors. Comparatively, 98.0% of NRG Energy shares are owned by institutional investors. 0.7% of NRG Energy shares are owned 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.

Volatility & Risk

Pampa Energia has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, NRG Energy has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Pampa Energia and NRG Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pampa Energia 2 2 1 0 1.80
NRG Energy 1 2 6 0 2.56

Pampa Energia currently has a consensus target price of $18.40, indicating a potential upside of 68.19%. NRG Energy has a consensus target price of $40.67, indicating a potential upside of 20.28%. Given Pampa Energia’s higher probable upside, research analysts clearly believe Pampa Energia is more favorable than NRG Energy.

Summary

NRG Energy beats Pampa Energia on 10 of the 14 factors compared between the two stocks.

About Pampa Energia

Pampa Energía S.A., an integrated electricity company, through its subsidiaries, engages in the generation, transmission, and distribution of electricity in Argentina. The company generates electricity through combined cycle gas-fired generating units, thermal generation plants, open-cycle gas turbines, and hydroelectric power generation systems, as well as through a wind farm. As of December 31, 2017, it had an electricity generation installed capacity of approximately 3,756 megawatts; 3 million electricity distribution customers in the northern region of the City of Buenos Aires and northwest of the greater Buenos Aires area; and 20,718 kilometers of high voltage transmission lines. The company is also involved in the exploration and production, and refining and distribution of oil and gas in Argentina, Venezuela, and Ecuador. In addition, it offers petrochemicals, such as intermediate gasoline products, aromatic solvents, hexane and other hydrogenated paraffinic solvents, and propellants for the cosmetic industry; and monomer styrene, and rubber and polymer products from natural gas, virgin naphtha, propane, and other supplies. As of December 31, 2017, the company had combined crude oil and natural gas proved reserves of approximately 167.1 million barrels of oil equivalent; one fully owned refinery with an installed capacity of approximately 30.2 thousand barrels per day; two storage plants with a capacity of approximately 1.2 million barrels; one lubricant plant; and three fully-owned petrochemical plants. It also operated a network of 250 gas stations. The company was formerly known as Pampa Holding S.A. and changed its name to Pampa Energía S.A. in September 2008. Pampa Energía S.A. was founded in 1945 and is headquartered in Buenos Aires, Argentina.

About NRG Energy

NRG Energy, Inc., together with its subsidiaries, operates as an energy company in the United States. The company is involved in the producing, selling, and delivering electricity and related products and services to 3.1 million residential, industrial, and commercial consumers. It generates electricity using natural gas, coal, oil, solar, nuclear, wind, fossil fuel, and nuclear sources. The company also provides system power, distributed generation, solar and wind products, backup generation, storage and distributed solar, demand response, energy efficiency, advisory, and on-site energy solutions; and carbon management and specialty services. In addition, it trades in electric power, natural gas, and related commodity and financial products, including forwards, futures, options, and swaps. Further, the company supplies fuels; provides transportation services; and directly sells energy, services, and products and services to retail customers under the NRG, Reliant, and other names. It develops, constructs, owns, and operates natural gas, coal, oil, solar, nuclear, wind, fossil fuel, and nuclear plants with generation capacity of 23,000 megawatts. The company was founded in 1989 and is headquartered in Princeton, New Jersey.

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