Critical Comparison: Eversource Energy (NYSE:ES) vs. TXNM Energy (NYSE:TXNM)

TXNM Energy (NYSE:TXNM) and Eversource Energy (NYSE:ES) are both oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Dividends

TXNM Energy pays an annual dividend of $1.55 per share and has a dividend yield of 3.3%. Eversource Energy pays an annual dividend of $2.86 per share and has a dividend yield of 5.1%. TXNM Energy pays out 80.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eversource Energy pays out -182.2% of its earnings in the form of a dividend. Eversource Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

TXNM Energy has a beta of 0.4, meaning that its share price is 60% less volatile than the S&P 500. Comparatively, Eversource Energy has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500.

Insider and Institutional Ownership

91.7% of TXNM Energy shares are owned by institutional investors. Comparatively, 80.0% of Eversource Energy shares are owned by institutional investors. 1.4% of TXNM Energy shares are owned by insiders. Comparatively, 0.4% of Eversource Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TXNM Energy	9.26%	9.69%	2.26%
Eversource Energy	-4.73%	10.90%	2.78%

Valuation and Earnings

This table compares TXNM Energy and Eversource Energy”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TXNM Energy	$1.94 billion	2.19	$88.35 million	$1.92	24.56
Eversource Energy	$11.91 billion	1.72	-$442.24 million	($1.57)	-35.54

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

Analyst Ratings

This is a breakdown of recent ratings for TXNM Energy and Eversource Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TXNM Energy	0	2	3	0	2.60
Eversource Energy	2	5	5	0	2.25

TXNM Energy presently has a consensus price target of $52.00, suggesting a potential upside of 10.29%. Eversource Energy has a consensus price target of $67.83, suggesting a potential upside of 21.57%. Given Eversource Energy’s higher possible upside, analysts clearly believe Eversource Energy is more favorable than TXNM Energy.

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.

About Eversource Energy

Eversource Energy, a public utility holding company, engages in the energy delivery business. The company operates through Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution segments. It is involved in the transmission and distribution of electricity; solar power facilities; and distribution of natural gas. The company operates regulated water utilities that provide water services to approximately 241,000 customers. It serves residential, commercial, industrial, municipal and fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. Eversource Energy was incorporated in 1927 and is headquartered in Springfield, Massachusetts.