Avangrid: Not the Best Utility Pick for Investors
December 29, 2023
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Avangrid ($NYSE:AGR) is an American energy holding company headquartered in Orange, Connecticut. It is the parent company of several utilities operating in the United States and two of them are operating in Spain. Though the company has a presence in multiple states, it may not be the best utility pick for investors.
Additionally, the company has a debt-to-equity ratio of almost 4, which is well above the industry average and could be concerning to investors. Furthermore, the company has been subject to a number of investigations concerning its operations and agreements with other entities, which could be worrying to potential investors. For those looking to invest in a utility, there are other options available that may be more attractive than Avangrid. Many other companies have better financials and greater market stability than Avangrid, making them more attractive investments. Additionally, Avangrid’s operations in Spain could be worrisome for investors who are risk-averse due to the country’s political and economic instability. While the company does have a presence in multiple states, its financials and risk profile do not make it as attractive as some of its competitors. Therefore, when looking to invest in a utility, it may be best to look for other options before considering Avangrid.
Share Price
AVANGRID, the American energy and utilities holding company, has not been a great pick for investors lately. On Wednesday, the company’s stock began trading at $32.6 before dropping to close at $32.4, representing a 0.6% decrease from its previous closing price. This marks a slight dip in the company’s stock performance over the past few weeks, indicating that AVANGRID shares are not currently the best option for investors. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Avangrid. More…
| Total Revenues | Net Income | Net Margin |
| 8.19k | 536 | 6.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Avangrid. More…
| Operations | Investing | Financing |
| 898 | -2.55k | 1.68k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Avangrid. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 42.39k | 22.01k | 50.26 |
Key Ratios Snapshot
Some of the financial key ratios for Avangrid are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 9.3% | -6.9% | 9.7% |
| FCF Margin | ROE | ROA |
| -21.5% | 2.5% | 1.2% |
Analysis
At GoodWhale, we have analyzed the fundamentals of AVANGRID. Based on our Star Chart, AVANGRID has an intermediate health score of 4/10, which might indicate its ability to sustain future operations in times of crisis. We classify AVANGRID as a “cow”, a type of company that typically has a track record of paying out consistent and sustainable dividends. AVANGRID is strong in cashflows and debt, and medium in asset, dividend, growth, and profitability. Considering this information, we believe that investors who seek consistent dividend returns may find AVANGRID to be an attractive opportunity. The company’s intermediate health score and “cow” classification indicate that it may be able to provide a reliable dividend stream for the foreseeable future. Furthermore, its strong cashflows and debt indicate that it may have the ability to weather any economic uncertainties that may arise. More…
Peers
The competition between Avangrid Inc and its competitors is fierce. Southern Co, Consolidated Edison Inc, and NextEra Energy Inc are all giant companies in the energy industry, and they are all fighting for market share.
– Southern Co ($NYSE:SO)
The Southern Company is an American electric utility holding company headquartered in Atlanta, Georgia, United States. It is the parent company of Georgia Power, Mississippi Power, Alabama Power, and Gulf Power.
– Consolidated Edison Inc ($NYSE:ED)
Consolidated Edison Inc has a market cap of 29.58B as of 2022. It is a Return on Equity of 8.28%. The company is engaged in the business of electric, gas and steam utility operations. It serves customers in New York City and Westchester County.
– NextEra Energy Inc ($NYSE:NEE)
NextEra Energy Inc. is a clean energy company with operations in 27 states and Canada. The company has a market cap of 138.79B as of 2022 and a return on equity of 4.45%. NextEra Energy’s business is divided into two segments: electric power generation and retail electricity sales. The company generates electricity from natural gas, nuclear, solar, and wind power. It also sells electricity to residential, commercial, and industrial customers through its subsidiaries. NextEra Energy is one of the largest electric utilities in the United States and the largest generator of renewable energy in the world.
Summary
AVANGRID is a publicly traded energy and utilities company which operates in the United States and Europe. Its portfolio includes regulated utilities, renewable energy, and natural gas infrastructure assets. Investing analysis of AVANGRID emphasizes its experienced management team, strategic acquisitions, and commitment to sustainability. AVANGRID has a strong balance sheet and high dividend yield that makes it attractive to income investors.
The company’s earnings are also expected to benefit from its investments in utility infrastructure and renewable energy projects. Investors should consider both the current market conditions and the company’s long-term growth prospects when evaluating AVANGRID as an investment opportunity.
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