Pampa Energía (NYSE:PAM – Get Free Report) and Talen Energy (NASDAQ:TLN – Get Free Report) are both mid-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.
Profitability
This table compares Pampa Energía and Talen Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Pampa Energía | 19.86% | 12.15% | 6.57% |
| Talen Energy | 50.48% | 8.59% | 3.13% |
Insider & Institutional Ownership
12.8% of Pampa Energía shares are owned by institutional investors. Comparatively, 0.4% of Talen Energy shares are owned by institutional investors. 55.5% of Pampa Energía shares are owned by company insiders. Comparatively, 0.2% of Talen Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pampa Energía | 0 | 3 | 1 | 0 | 2.25 |
| Talen Energy | 0 | 0 | 12 | 0 | 3.00 |
Pampa Energía currently has a consensus target price of $71.63, indicating a potential upside of 9.12%. Talen Energy has a consensus target price of $241.09, indicating a potential upside of 22.76%. Given Talen Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Talen Energy is more favorable than Pampa Energía.
Volatility & Risk
Pampa Energía has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500. Comparatively, Talen Energy has a beta of 1.93, indicating that its share price is 93% more volatile than the S&P 500.
Valuation and Earnings
This table compares Pampa Energía and Talen Energy”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pampa Energía | $1.88 billion | 1.91 | $302.00 million | $11.30 | 5.81 |
| Talen Energy | $2.07 billion | 4.31 | $613.00 million | $17.41 | 11.28 |
Talen Energy has higher revenue and earnings than Pampa Energía. Pampa Energía is trading at a lower price-to-earnings ratio than Talen Energy, indicating that it is currently the more affordable of the two stocks.
Summary
Talen Energy beats Pampa Energía on 10 of the 14 factors compared between the two stocks.
About Pampa Energía
Pampa Energía S.A. operates as an integrated power company in Argentina. The company operates through Electricity Generation, Oil and Gas, Petrochemicals, and Holding and Other Business segments. It generates electricity through thermal plants, hydroelectric plants, and wind farms with a 5,332 megawatt (MW) installed capacity. The company also explores for and produces oil and gas in the provinces of Neuquén and Río Negro. In addition, it produces petrochemicals, such as styrene, synthetic rubber, and polystyrene. Further, the company operates and maintains a 22,391 km high-voltage electricity transmission network in Argentina. Additionally, it holds a concession for the transportation of natural gas with 9,248 km of gas pipelines in the center, west, and south of Argentina; and processes and sells natural gas liquids in Bahía Blanca in the Province of Buenos Aires, as well as offers related advisory services. 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 incorporated in 1945 and is based in Buenos Aires, Argentina.
About Talen Energy
Talen Energy Corporation is a U.S.-based energy and power generation company. The Company owns or controls approximately 16,000 megawatts of capacity in wholesale power markets, principally in the Northeast, Mid-Atlantic and Southwest regions of the United States. The Company generates and sells electricity, capacity and related products from power plants that use fuel sources, such as nuclear, natural gas and coal. The Company’s Susquehanna nuclear power plant has approximately two boiling water reactors with a combined capacity of over 2,600 megawatts. Its fossil fuel plants are located in Athens, Barney Davis, Bayonne, Brandon Shores, Brunner Island, Camden, Colstrip and Dartmouth, among others. It has an art energy trading center located in Allentown, Pennsylvania (PA), where it manages asset load obligations, fuel supply, capacity and related products, and all supporting physical or financial transactions for its electric generation portfolio.
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