Summit Midstream Partners (NYSE:SMC) vs. Dorchester Minerals (NASDAQ:DMLP) Critical Contrast

Dorchester Minerals (NASDAQ:DMLP) and Summit Midstream Partners (NYSE:SMC) are both small-cap energy companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Insider & Institutional Ownership

19.2% of Dorchester Minerals shares are owned by institutional investors. Comparatively, 43.0% of Summit Midstream Partners shares are owned by institutional investors. 5.9% of Dorchester Minerals shares are owned by company insiders. Comparatively, 43.0% of Summit Midstream Partners shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Dorchester Minerals has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500. Comparatively, Summit Midstream Partners has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500.

Earnings & Valuation

This table compares Dorchester Minerals and Summit Midstream Partners”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dorchester Minerals	$192.22 million	7.55	$55.25 million	$1.76	16.79
Summit Midstream Partners	$583.33 million	1.18	$8.93 million	($1.11)	-30.59

Dorchester Minerals has higher earnings, but lower revenue than Summit Midstream Partners. Summit Midstream Partners is trading at a lower price-to-earnings ratio than Dorchester Minerals, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Dorchester Minerals and Summit Midstream Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dorchester Minerals	45.45%	28.43%	27.83%
Summit Midstream Partners	-0.06%	-0.04%	-0.01%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Dorchester Minerals and Summit Midstream Partners, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dorchester Minerals	0	1	0	0	2.00
Summit Midstream Partners	0	2	2	0	2.50

Summit Midstream Partners has a consensus target price of $43.00, suggesting a potential upside of 26.63%. Given Summit Midstream Partners’ stronger consensus rating and higher possible upside, analysts clearly believe Summit Midstream Partners is more favorable than Dorchester Minerals.

About Dorchester Minerals

Dorchester Minerals, L.P. engages in the acquisition, ownership, and administration of royalty properties in the United States. Its royalty properties include producing and nonproducing mineral, royalty, overriding royalty, net profits, and leasehold interests in 593 counties and parishes in 28 states; and net profits interests represent net profits overriding royalty interests in various properties owned by the operating partnership. Dorchester Minerals Management LP serves as the general partner of Dorchester Minerals, L.P. The company was founded in 1982 and is based in Dallas, Texas.

About Summit Midstream Partners

Summit Midstream Corporation focuses on owning, developing, and operating midstream energy infrastructure assets primarily shale formations in the continental United States. It operates natural gas, crude oil, and produced water gathering systems in four unconventional resource basins, including the Williston Basin in North Dakota, which includes the Bakken and Three Forks shale formations; the Denver-Julesburg Basin that consists of the Niobrara and Codell shale formations in Colorado and Wyoming; the Fort Worth Basin in Texas, which comprises the Barnett Shale formation; and the Piceance Basin in Colorado, which includes the Mesaverde formation, as well as the emerging Mancos and Niobrara Shale formations. It serves natural gas and crude oil producers. Summit Midstream Corporation was founded in 2012 and is based in Houston, Texas.