Kenon Holdings Ltd. (KEN) vs Talen Energy Corporation (TLN)

Kenon Holdings Ltd. and Talen Energy Corporation are both Utilities Independent Power Producers companies. Talen Energy Corporation is the larger, with a market value of $14.8B against $3.3B — 4.5× the size. Talen Energy Corporation has negative trailing earnings, so its P/E is not meaningful; Kenon Holdings Ltd. trades at 22.7×. Talen Energy Corporation grew revenue faster over the last twelve months: 60.8% against 53.4%. Kenon Holdings Ltd. has the higher net margin (10.0% vs −5.38%) and the higher return on invested capital (1.32% vs 0.50%). Across the 18 metrics below, Kenon Holdings Ltd. leads on 14 and Talen Energy Corporation on 4.

Valuation

Metric KEN TLN Utilities Independent Power Producers median
P/E 22.67 n/m 25.63
P/S 2.78 4.07 2.78
P/B 0.97 8.53 3.29
Price to free cash flow n/m 31.47 —
EV/EBITDA 23.59 48.26 13.69
EV/Sales 3.79 6.78 3.62
Earnings yield 4.41% (1.33%) 2.03%
Free cash flow yield (7.91%) 3.18% (1.89%)

Profitability

Metric KEN TLN Utilities Independent Power Producers median
Gross margin 18.66% 53.86% 37.99%
Operating margin 8.20% 2.56% 4.83%
Net margin 10.03% (5.38%) 1.18%
Free cash flow margin (21.25%) 12.92% 0.50%
Return on equity 3.98% (12.82%) 1.70%
Return on assets 2.06% (1.77%) 0.93%
Return on invested capital 1.32% 0.50% 2.93%

Growth

Metric KEN TLN Utilities Independent Power Producers median
Revenue growth (TTM) 53.35% 60.83% 12.80%
EPS growth (last fiscal year) (96.74%) (127.11%) —
Revenue growth, 5-year CAGR 17.67% — 15.82%
Net income growth, 5-year CAGR (33.43%) — 1.71%

Health

Metric KEN TLN Utilities Independent Power Producers median
Debt to equity 0.88 5.84 0.74
Current ratio 3.22 0.78 1.21
Net debt to EBITDA 1.70 21.19 3.88

Dividend

Metric KEN TLN Utilities Independent Power Producers median
Dividend yield 10.97% — —
Payout ratio 2.37 — 0.17

Size

Metric KEN TLN Utilities Independent Power Producers median
Market cap 3.32b 14.81b 11.01b

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