Reviewing Public Service Enterprise Group (NYSE:PEG) & PPL (NYSE:PPL)
by Michael Walen · The Markets DailyPPL (NYSE:PPL – Get Free Report) and Public Service Enterprise Group (NYSE:PEG – Get Free Report) are both large-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, institutional ownership, profitability and risk.
Analyst Ratings
This is a summary of current ratings for PPL and Public Service Enterprise Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| PPL | 0 | 2 | 8 | 2 | 3.00 |
| Public Service Enterprise Group | 0 | 5 | 9 | 0 | 2.64 |
PPL currently has a consensus price target of $41.20, indicating a potential upside of 20.14%. Public Service Enterprise Group has a consensus price target of $90.96, indicating a potential upside of 13.62%. Given PPL’s stronger consensus rating and higher probable upside, equities research analysts plainly believe PPL is more favorable than Public Service Enterprise Group.
Dividends
PPL pays an annual dividend of $1.09 per share and has a dividend yield of 3.2%. Public Service Enterprise Group pays an annual dividend of $2.52 per share and has a dividend yield of 3.1%. PPL pays out 73.6% of its earnings in the form of a dividend. Public Service Enterprise Group pays out 60.6% 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. PPL has increased its dividend for 3 consecutive years and Public Service Enterprise Group has increased its dividend for 14 consecutive years.
Institutional & Insider Ownership
77.0% of PPL shares are owned by institutional investors. Comparatively, 73.3% of Public Service Enterprise Group shares are owned by institutional investors. 0.3% of PPL shares are owned by company insiders. Comparatively, 0.2% of Public Service Enterprise Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Risk & Volatility
PPL has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500. Comparatively, Public Service Enterprise Group has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500.
Profitability
This table compares PPL and Public Service Enterprise Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| PPL | 12.16% | 9.08% | 3.06% |
| Public Service Enterprise Group | 17.77% | 12.62% | 3.74% |
Earnings and Valuation
This table compares PPL and Public Service Enterprise Group”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| PPL | $8.46 billion | 3.00 | $888.00 million | $1.48 | 23.17 |
| Public Service Enterprise Group | $10.29 billion | 3.88 | $1.77 billion | $4.16 | 19.24 |
Public Service Enterprise Group has higher revenue and earnings than PPL. Public Service Enterprise Group is trading at a lower price-to-earnings ratio than PPL, indicating that it is currently the more affordable of the two stocks.
Summary
Public Service Enterprise Group beats PPL on 10 of the 18 factors compared between the two stocks.
About PPL
PPL Corporation, an energy company, focuses on providing electricity and natural gas to approximately 3.6 million customers in the United States. It operates through three segments: Kentucky Regulated, Pennsylvania Regulated, and Rhode Island Regulated. The company delivers electricity to customers in Pennsylvania, Kentucky, Virginia, and Rhode Island; delivers natural gas to customers in Kentucky and Rhode Island; and generates electricity from power plants in Kentucky. PPL Corporation was founded in 1920 and is headquartered in Allentown, Pennsylvania.
About Public Service Enterprise Group
Public Service Enterprise Group Incorporated, through its subsidiaries, operates in electric and gas utility business in the United States. It operates through PSE&G and PSEG Power segments. The PSE&G segment transmits electricity; distributes electricity and natural gas to residential, commercial, and industrial customers; and appliance services and repairs to customers through its service territory, as well as invests in solar generation projects, and energy efficiency and related programs. The PSEG Power segment engages in nuclear generation businesses; and supplies power and natural gas to nuclear power plants and gas storage facilities activities. As of December 31, 2023, it had electric transmission and distribution system of 25,000 circuit miles and 866,600 poles; 56 switching stations with an installed capacity of 39,953 megavolt-amperes (MVA), and 235 substations with an installed capacity of 10,382 MVA; 109 MVA aggregate installed capacity for substations; four electric distribution headquarters and five electric sub-headquarters; 18,000 miles of gas mains, 12 gas distribution headquarters, two sub-headquarters, and one meter shop, as well as 56 natural gas metering and regulating stations; and 158 MegaWatts defined conditions of installed PV solar capacity. Public Service Enterprise Group Incorporated was founded in 1903 and is based in Newark, New Jersey.