Financial Survey: CenterPoint Energy (NYSE:CNP) and Centrais Elétricas Brasileiras S.A. – Eletrobrás (NYSE:EBR)

CenterPoint Energy (NYSE:CNP) and Centrais Elétricas Brasileiras S.A. – Eletrobrás (NYSE:EBR) are both large-cap utilities companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.

Institutional & Insider Ownership

91.8% of CenterPoint Energy shares are owned by institutional investors. Comparatively, 6.5% of Centrais Elétricas Brasileiras S.A. – Eletrobrás shares are owned by institutional investors. 0.2% of CenterPoint Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for CenterPoint Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CenterPoint Energy	1	8	2	0	2.09
Centrais Elétricas Brasileiras S.A. – Eletrobrás	0	0	0	0	N/A

CenterPoint Energy currently has a consensus target price of $29.73, suggesting a potential upside of 9.29%. Given CenterPoint Energy’s higher possible upside, research analysts clearly believe CenterPoint Energy is more favorable than Centrais Elétricas Brasileiras S.A. – Eletrobrás.

Volatility and Risk

CenterPoint Energy has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Centrais Elétricas Brasileiras S.A. – Eletrobrás has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500.

Earnings and Valuation

This table compares CenterPoint Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CenterPoint Energy	$8.57 billion	2.03	$917.00 million	$1.42	19.15
Centrais Elétricas Brasileiras S.A. – Eletrobrás	$35.82 billion	0.49	$977.82 million	$0.84	9.06

Centrais Elétricas Brasileiras S.A. – Eletrobrás has higher revenue and earnings than CenterPoint Energy. Centrais Elétricas Brasileiras S.A. – Eletrobrás is trading at a lower price-to-earnings ratio than CenterPoint Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares CenterPoint Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CenterPoint Energy	12.28%	10.81%	2.68%
Centrais Elétricas Brasileiras S.A. – Eletrobrás	12.98%	4.18%	1.75%

Dividends

CenterPoint Energy pays an annual dividend of $0.80 per share and has a dividend yield of 2.9%. Centrais Elétricas Brasileiras S.A. – Eletrobrás pays an annual dividend of $0.05 per share and has a dividend yield of 0.7%. CenterPoint Energy pays out 56.3% of its earnings in the form of a dividend. Centrais Elétricas Brasileiras S.A. – Eletrobrás pays out 6.0% 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.

Summary

CenterPoint Energy beats Centrais Elétricas Brasileiras S.A. – Eletrobrás on 10 of the 15 factors compared between the two stocks.

About CenterPoint Energy

CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The company operates through two segments, Electric and Natural Gas. The Electric segment includes electric transmission and distribution services to electric customers and electric generation assets, as well as optimizes assets in the wholesale power market. The Natural Gas segment engages in the intrastate natural gas sales, and natural gas transportation and distribution for residential, commercial, industrial and institutional customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas; permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies; and provides maintenance and repair services of home appliances to customers in Minnesota and home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio, and Texas through a third party. It serves approximately 2,534,730 metered customers; owned 348 substations with transformer capacity of 79,719 megavolt amperes; and owned and operated 217 miles of intrastate pipeline in Louisiana and Texas. The company was founded in 1866 and is headquartered in Houston, Texas.

About Centrais Elétricas Brasileiras S.A. – Eletrobrás

Centrais Elétricas Brasileiras S.A. – Eletrobrás, through its subsidiaries, engages in the generation, transmission, and commercialization of electricity in Brazil. The company generates electricity through hydroelectric, thermoelectric, nuclear, wind, and solar plants. As of December 31, 2023, it owned and operated 44 hydroelectric plants with a total capacity of 42,293.5 megawatt (MW); 5 thermal plants, including coal and gas power generation units with a total installed capacity of 1,632 MW; and two nuclear power plants comprising Angra 1 with an installed capacity of 657 MW and Angra 2 with an installed capacity of 1350 MW. It also owns and operates 66,539.17 kilometers of transmission lines. The company was incorporated in 1962 and is based in Rio De Janeiro, Brazil.