Analyzing Ormat Technologies (NYSE:ORA) and TXNM Energy (NYSE:TXNM)

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

Institutional and Insider Ownership

95.5% of Ormat Technologies shares are owned by institutional investors. Comparatively, 91.7% of TXNM Energy shares are owned by institutional investors. 1.0% of Ormat Technologies shares are owned by company insiders. Comparatively, 1.4% of TXNM Energy shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Ormat Technologies and TXNM Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ormat Technologies	$829.42 million	6.06	$124.40 million	$1.96	42.39
TXNM Energy	$1.94 billion	2.08	$88.35 million	$1.92	23.29

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ormat Technologies and TXNM Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ormat Technologies	0	3	3	0	2.50
TXNM Energy	0	1	3	0	2.75

Ormat Technologies currently has a consensus target price of $84.50, indicating a potential upside of 1.70%. TXNM Energy has a consensus target price of $47.75, indicating a potential upside of 6.78%. Given TXNM Energy’s stronger consensus rating and higher probable upside, analysts clearly believe TXNM Energy is more favorable than Ormat Technologies.

Risk & Volatility

Ormat Technologies has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500. Comparatively, TXNM Energy has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500.

Dividends

Ormat Technologies pays an annual dividend of $0.48 per share and has a dividend yield of 0.6%. TXNM Energy pays an annual dividend of $1.55 per share and has a dividend yield of 3.5%. Ormat Technologies pays out 24.5% of its earnings in the form of a dividend. 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Ormat Technologies	13.33%	5.29%	2.42%
TXNM Energy	9.26%	9.69%	2.26%

Summary

Ormat Technologies beats TXNM Energy on 9 of the 15 factors compared between the two stocks.

About Ormat Technologies

Ormat Technologies, Inc. engages in the geothermal and recovered energy power business in the United States, Indonesia, Kenya, Turkey, Chile, Guatemala, Guadeloupe, New Zealand, Honduras, and internationally. It operates in three segments: Electricity, Product, and Energy Storage. The Electricity segment develops, builds, owns, and operates geothermal, solar photovoltaic, and recovered energy-based power plants; and sells electricity. The Product segment designs, manufactures, and sells equipment for geothermal and recovered energy-based electricity generation; and provides services relating to the engineering, procurement, construction, operation, and maintenance of geothermal and recovered energy-based power plants. This segment serves contractors; and owners and operators of interstate natural gas pipelines, gas processing plants, and cement plants, as well as companies in other energy-intensive industrial processes. The Energy Storage segment offers battery energy storage systems and related services. Ormat Technologies, Inc. was founded in 1965 and is headquartered in Reno, Nevada.

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.