Critical Survey: TXNM Energy (NYSE:TXNM) and Centrais Elétricas Brasileiras S.A. – Eletrobrás (NYSE:EBR)

TXNM Energy (NYSE:TXNM) and Centrais Elétricas Brasileiras S.A. – Eletrobrás (NYSE:EBR) are both oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, institutional ownership, risk, dividends, earnings, profitability and analyst recommendations.

Risk and Volatility

TXNM Energy has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, Centrais Elétricas Brasileiras S.A. – Eletrobrás has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for TXNM Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TXNM Energy	0	1	3	0	2.75
Centrais Elétricas Brasileiras S.A. – Eletrobrás	0	0	0	1	4.00

TXNM Energy presently has a consensus price target of $50.25, indicating a potential upside of 2.47%. Given TXNM Energy’s higher possible upside, equities analysts clearly believe TXNM Energy is more favorable than Centrais Elétricas Brasileiras S.A. – Eletrobrás.

Dividends

TXNM Energy pays an annual dividend of $1.55 per share and has a dividend yield of 3.2%. Centrais Elétricas Brasileiras S.A. – Eletrobrás pays an annual dividend of $0.06 per share and has a dividend yield of 1.0%. 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. Centrais Elétricas Brasileiras S.A. – Eletrobrás pays out 8.6% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares TXNM Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás”s 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	2.28	$88.35 million	$1.92	25.54
Centrais Elétricas Brasileiras S.A. – Eletrobrás	$7.44 billion	1.84	$977.82 million	$0.70	8.51

Centrais Elétricas Brasileiras S.A. – Eletrobrás has higher revenue and earnings than TXNM Energy. Centrais Elétricas Brasileiras S.A. – Eletrobrás is trading at a lower price-to-earnings ratio than TXNM Energy, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

91.7% of TXNM Energy shares are owned by institutional investors. Comparatively, 2.6% of Centrais Elétricas Brasileiras S.A. – Eletrobrás shares are owned by institutional investors. 1.4% of TXNM Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares TXNM Energy and Centrais Elétricas Brasileiras S.A. – Eletrobrás’ 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%
Centrais Elétricas Brasileiras S.A. – Eletrobrás	26.50%	9.00%	3.82%

Summary

TXNM Energy beats Centrais Elétricas Brasileiras S.A. – Eletrobrás on 9 of the 17 factors compared between the two stocks.

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 Centrais Elétricas Brasileiras S.A. – Eletrobrás

Centrais Elétricas Brasileiras S.A. – Eletrobrás, through its subsidiaries, engages in the generation, transmission, and commercialization of electricity in Brazil. The company generates electricity through hydroelectric, thermoelectric, nuclear, wind, and solar plants. As of December 31, 2023, it owned and operated 44 hydroelectric plants with a total capacity of 42,293.5 megawatt (MW); 5 thermal plants, including coal and gas power generation units with a total installed capacity of 1,632 MW; and two nuclear power plants comprising Angra 1 with an installed capacity of 657 MW and Angra 2 with an installed capacity of 1350 MW. It also owns and operates 66,539.17 kilometers of transmission lines. The company was incorporated in 1962 and is based in Rio De Janeiro, Brazil.