Critical Comparison: Otter Tail (NASDAQ:OTTR) vs. Enlight Renewable Energy (NASDAQ:ENLT)

Otter Tail (NASDAQ:OTTR) and Enlight Renewable Energy (NASDAQ:ENLT) are both utilities companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.

Volatility and Risk

Otter Tail has a beta of 0.56, suggesting that its stock price is 44% less volatile than the S&P 500. Comparatively, Enlight Renewable Energy has a beta of 1.84, suggesting that its stock price is 84% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Otter Tail and Enlight Renewable Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Otter Tail	1	1	0	0	1.50
Enlight Renewable Energy	0	2	2	0	2.50

Otter Tail presently has a consensus price target of $68.00, suggesting a potential downside of 19.60%. Enlight Renewable Energy has a consensus price target of $18.50, suggesting a potential upside of 17.39%. Given Enlight Renewable Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Enlight Renewable Energy is more favorable than Otter Tail.

Insider and Institutional Ownership

61.3% of Otter Tail shares are owned by institutional investors. Comparatively, 38.9% of Enlight Renewable Energy shares are owned by institutional investors. 2.3% of Otter Tail shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Otter Tail and Enlight Renewable Energy’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Otter Tail	$1.35 billion	2.61	$294.19 million	$7.00	12.08
Enlight Renewable Energy	$255.70 million	7.12	$70.92 million	$0.57	27.65

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

Profitability

This table compares Otter Tail and Enlight Renewable Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Otter Tail	21.81%	21.64%	9.41%
Enlight Renewable Energy	27.74%	5.05%	1.68%

About Otter Tail

Otter Tail Corporation, together with its subsidiaries, engages in electric utility, manufacturing, and plastic pipe businesses in the United States. It operates through three segments: Electric, Manufacturing, and Plastics. The Electric segment produces, transmits, distributes, and sells electric energy in Minnesota, North Dakota, and South Dakota; and operates as a participant in the Midcontinent Independent System Operator markets. This segment generates electricity through coal, fuel oil, solar, wind, and natural gas. It serves approximately residential, commercial, and industrial customers. The Manufacturing segment engages in the contract machining, metal parts stamping, fabrication and painting, production of plastic thermoformed horticultural containers, life science and industrial packaging, and material handling components and extruded raw material stock for the recreational vehicle, lawn and garden, agricultural, construction, and industrial and energy equipment end markets. The Plastics segment manufactures polyvinyl chloride pipes for municipal water, rural water, wastewater, storm drainage and water reclamation system, and other uses for customers in the horticulture, medical and life sciences, industrial, recreation, and electronics industries. This segment markets its products to wholesalers and distributors through independent sales representatives, company salespersons, and customer service representatives. The company was formerly known as Otter Tail Power Company and changed its name to Otter Tail Corporation in 2001. Otter Tail Corporation was founded in 1907 and is headquartered in Fergus Falls, Minnesota.

About Enlight Renewable Energy

Enlight Renewable Energy Ltd operates a renewable energy platform in Israel, Central-Eastern Europe, Western Europe, and the United States. The company develops, finances, constructs, owns, and operates utility-scale renewable energy projects. It develops wind energy and solar energy projects, as well as energy storage projects. The company was incorporated in 1981 and is headquartered in Rosh Haayin, Israel.