Noble Midstream Partners (NYSE: NBLX) and Western Refining Logistics (NYSE:WNRL) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, risk and analyst recommendations.
Institutional and Insider Ownership
89.1% of Noble Midstream Partners shares are held by institutional investors. Comparatively, 40.1% of Western Refining Logistics shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
This is a breakdown of recent ratings and recommmendations for Noble Midstream Partners and Western Refining Logistics, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Noble Midstream Partners||0||1||6||0||2.86|
|Western Refining Logistics||0||0||0||0||N/A|
Noble Midstream Partners currently has a consensus price target of $58.67, suggesting a potential upside of 19.12%. Given Noble Midstream Partners’ higher possible upside, research analysts plainly believe Noble Midstream Partners is more favorable than Western Refining Logistics.
Noble Midstream Partners pays an annual dividend of $1.95 per share and has a dividend yield of 4.0%. Western Refining Logistics pays an annual dividend of $1.87 per share and has a dividend yield of 7.8%. Noble Midstream Partners pays out 48.0% of its earnings in the form of a dividend. Western Refining Logistics pays out 174.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Refining Logistics has raised its dividend for 3 consecutive years. Western Refining Logistics is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation and Earnings
This table compares Noble Midstream Partners and Western Refining Logistics’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Noble Midstream Partners||$239.28 million||8.16||$140.57 million||$4.06||12.13|
|Western Refining Logistics||N/A||N/A||N/A||$1.07||22.29|
Noble Midstream Partners has higher revenue and earnings than Western Refining Logistics. Noble Midstream Partners is trading at a lower price-to-earnings ratio than Western Refining Logistics, indicating that it is currently the more affordable of the two stocks.
This table compares Noble Midstream Partners and Western Refining Logistics’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Noble Midstream Partners||58.40%||34.74%||22.71%|
|Western Refining Logistics||2.98%||62.93%||13.13%|
Risk and Volatility
Noble Midstream Partners has a beta of 1.85, meaning that its share price is 85% more volatile than the S&P 500. Comparatively, Western Refining Logistics has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500.
Noble Midstream Partners beats Western Refining Logistics on 9 of the 13 factors compared between the two stocks.
Noble Midstream Partners Company Profile
Noble Midstream Partners LP is engaged in owning, operating, developing and acquiring a range of domestic midstream infrastructure assets. The Company’s areas of focus are in the area of Denver-Julesburg (DJ) Basin in Colorado and the Southern Delaware Basin position of the Permian Basin in Texas (Delaware Basin). Its segments include Gathering Systems, Fresh Water Delivery, and Investments in White Cliffs and Other. The Gathering Systems segment includes crude oil, natural gas and produced water gathering, as well as crude oil treating. It holds interest in White Cliffs Pipeline L.L.C. (the White Cliffs Interest). The Investments in White Cliffs and Other segment includes activity associated with the White Cliffs Interest. As of December 31, 2016, the White Cliffs Pipeline system consisted of two 527-mile crude oil pipelines that extended from the DJ Basin to the Cushing, Oklahoma. It provides crude oil, natural gas, and water-related midstream services for Noble Energy, Inc.
Western Refining Logistics Company Profile
Western Refining Logistics, LP owns, operates, develops, and acquires logistics and related assets and businesses to include terminals, storage tanks, pipelines and other logistics assets related to the terminaling, transportation, storage and distribution of crude oil and refined products. The Company’s segments include logistics and wholesale. The Company operates its logistics business and wholesale business under commercial and service agreements with Western Refining, Inc. (Western). Its logistics assets consist of pipeline and gathering infrastructure and terminalling, transportation and storage assets in the Southwest and the Upper Great Plains region. Its wholesale business purchases its petroleum fuels from Western, and its lubricants and additional petroleum fuels from third-party suppliers.
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