TXNM Energy (NYSE:TXNM) versus CEMIG (NYSE:CIG) Head-To-Head Analysis

CEMIG (NYSE:CIG) and TXNM Energy (NYSE:TXNM) are both mid-cap utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, analyst recommendations, risk and dividends.

Analyst Recommendations

This is a summary of current recommendations and price targets for CEMIG and TXNM Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CEMIG	0	1	0	0	2.00
TXNM Energy	0	1	3	0	2.75

TXNM Energy has a consensus price target of $50.25, indicating a potential upside of 1.86%. Given TXNM Energy’s stronger consensus rating and higher probable upside, analysts clearly believe TXNM Energy is more favorable than CEMIG.

Insider and Institutional Ownership

91.7% of TXNM Energy shares are held by institutional investors. 1.4% of TXNM Energy shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

CEMIG pays an annual dividend of $0.17 per share and has a dividend yield of 9.0%. TXNM Energy pays an annual dividend of $1.63 per share and has a dividend yield of 3.3%. CEMIG pays out 40.7% of its earnings in the form of a dividend. TXNM Energy pays out 84.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CEMIG is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares CEMIG and TXNM Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CEMIG	$7.38 billion	0.73	$1.15 billion	$0.42	4.50
TXNM Energy	$1.91 billion	2.33	$88.35 million	$1.92	25.69

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

Profitability

This table compares CEMIG and TXNM Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CEMIG	15.70%	21.49%	9.64%
TXNM Energy	9.26%	9.69%	2.26%

Risk and Volatility

CEMIG has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500. Comparatively, TXNM Energy has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.

About CEMIG

Companhia Energética de Minas Gerais, through its subsidiaries, engages in the generation, transmission, distribution, and sale of electricity in Brazil. The company generates electricity through renewable energy sources, such as water, wind, sun, and biomass; or non-renewable sources, including fossil and nuclear fuels. As of December 31, 2016, it operated hydroelectric plants, thermoelectric plants, and solar plants with a total installed capacity of approximately 8,000 megawatts in 10 states of Brazil. It is also involved in the telecommunications and energy solutions consulting businesses; exploitation of natural gas; sale and trading of electricity; and acquisition, transport, and distribution of gas and its subproducts and derivatives, as well as provision of technology systems and systems for operational management of public service concessions, including companies operating in electricity, gas, water and sewerage, and other utility companies. The company was founded in 1952 and is headquartered in Belo Horizonte, Brazil.

About TXNM Energy

TXNM Energy, Inc., through its subsidiaries, provides electricity and electric services in the United States. It operates through Public Service Company of New Mexico (PNM) and Texas-New Mexico Power Company (TNMP) segments. The PNM segment engages in the generation, transmission, and distribution of electricity. The segment owns and leases communications, office and other equipment, office space, vehicles, and real estate. It generates electricity using coal, natural gas and oil, and nuclear fuel and waste, as well as solar, wind, geothermal, and battery storage energy sources. The TNMP segment provides regulated transmission and distribution services. The segment also owns and leases vehicles, service facilities, and office locations throughout its service territory. The company serves residential, commercial, and industrial customers and end-users of electricity in New Mexico and Texas. The company was formerly known as PNM Resources, Inc and changed its name to TXNM Energy, Inc. in August 2024. TXNM Energy, Inc. was founded in 1882 and is based in Albuquerque, New Mexico.