Head to Head Analysis: Terna – Rete Elettrica Nazionale Società per Azioni (OTCMKTS:TERRF) versus Endesa (OTCMKTS:ELEZY)

Terna – Rete Elettrica Nazionale Società per Azioni (OTCMKTS:TERRF – Get Rating) and Endesa (OTCMKTS:ELEZY – Get Rating) are both utilities companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, institutional ownership, dividends, risk, analyst recommendations, earnings and valuation.

Insider and Institutional Ownership

20.2% of Terna – Rete Elettrica Nazionale Società per Azioni shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Terna – Rete Elettrica Nazionale Società per Azioni and Endesa’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Terna – Rete Elettrica Nazionale Società per Azioni	N/A	N/A	N/A	$0.26	30.68
Endesa	N/A	N/A	N/A	$0.73	13.51

Endesa is trading at a lower price-to-earnings ratio than Terna – Rete Elettrica Nazionale Società per Azioni, indicating that it is currently the more affordable of the two stocks.

Dividends

Terna – Rete Elettrica Nazionale Società per Azioni pays an annual dividend of $0.16 per share and has a dividend yield of 2.0%. Endesa pays an annual dividend of $0.55 per share and has a dividend yield of 5.6%. Terna – Rete Elettrica Nazionale Società per Azioni pays out 61.8% of its earnings in the form of a dividend. Endesa pays out 75.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Recommendations

This is a summary of current ratings and price targets for Terna – Rete Elettrica Nazionale Società per Azioni and Endesa, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Terna – Rete Elettrica Nazionale Società per Azioni	1	4	1	0	2.00
Endesa	1	0	2	0	2.33

Endesa has a consensus price target of $22.75, indicating a potential upside of 130.73%. Given Endesa’s stronger consensus rating and higher possible upside, analysts clearly believe Endesa is more favorable than Terna – Rete Elettrica Nazionale Società per Azioni.

Profitability

This table compares Terna – Rete Elettrica Nazionale Società per Azioni and Endesa’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Terna – Rete Elettrica Nazionale Società per Azioni	N/A	N/A	N/A
Endesa	N/A	N/A	N/A

Summary

Endesa beats Terna – Rete Elettrica Nazionale Società per Azioni on 5 of the 8 factors compared between the two stocks.

About Terna – Rete Elettrica Nazionale Società per Azioni

(Get Rating)

Terna – Rete Elettrica Nazionale Società per Azioni, together with its subsidiaries, engages in the electricity transmission and dispatching activities in Italy, Euro-area countries, and internationally. The company operates through Regulated, Non-Regulated, and International segments. It is involved in the planning, development, management, operation, and maintenance of national transmission grid, electricity infrastructures, and high-voltage infrastructures. The company also offers telecommunications systems and equipment, connectivity services, energy solutions, and operation and maintenance services. In addition, it designs, produces, commercializes, and repairs power transformers for electricity transmission and distribution grids, industrial transformers for the steel and metals industries, and special transformers for convertors used in electrochemical production; designs, produces, and supplies marine and terrestrial cables; implements and develops renewable energy projects; and undertakes private interconnector projects, as well as owns the national transmission grid. The company was founded in 1999 and is headquartered in Rome, Italy.

About Endesa

(Get Rating)

Endesa SA engages in the generation, distribution, and sale of electricity. It is also involved in the natural gas sector and provides other energy-related services. It operates through the following segments: Generation & Supply, Distribution, and Structure. The Generation & Supply segment refers to the production of electricity from energy sources such as hydroelectric, nuclear, thermal, wind, and solar. The Distribution segment consists of distribution of electricity to consumption points. The Structure segment includes the balances and transactions of holding and financing companies. The company was founded on November 18, 1944 and is headquartered in Madrid, Spain.