Hallador Energy (NASDAQ: HNRG) and SunCoke Energy Partners (NYSE:SXCP) are both small-cap oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.
This table compares Hallador Energy and SunCoke Energy Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|SunCoke Energy Partners||-2.28%||14.22%||4.89%|
This table compares Hallador Energy and SunCoke Energy Partners’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Hallador Energy||$271.63 million||0.73||$32.04 million||$1.08||6.11|
|SunCoke Energy Partners||$845.60 million||0.99||-$18.10 million||($1.97)||-9.19|
Hallador Energy has higher earnings, but lower revenue than SunCoke Energy Partners. SunCoke Energy Partners is trading at a lower price-to-earnings ratio than Hallador Energy, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
55.4% of Hallador Energy shares are held by institutional investors. Comparatively, 11.5% of SunCoke Energy Partners shares are held by institutional investors. 55.7% of Hallador Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Volatility and Risk
Hallador Energy has a beta of -0.18, meaning that its share price is 118% less volatile than the S&P 500. Comparatively, SunCoke Energy Partners has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500.
This is a summary of recent recommendations for Hallador Energy and SunCoke Energy Partners, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|SunCoke Energy Partners||0||0||1||0||3.00|
Hallador Energy presently has a consensus price target of $10.00, indicating a potential upside of 51.52%. Given Hallador Energy’s higher possible upside, equities research analysts plainly believe Hallador Energy is more favorable than SunCoke Energy Partners.
Hallador Energy pays an annual dividend of $0.16 per share and has a dividend yield of 2.4%. SunCoke Energy Partners pays an annual dividend of $2.38 per share and has a dividend yield of 13.1%. Hallador Energy pays out 14.8% of its earnings in the form of a dividend. SunCoke Energy Partners pays out -120.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Hallador Energy has increased its dividend for 2 consecutive years. SunCoke Energy Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.
Hallador Energy beats SunCoke Energy Partners on 8 of the 15 factors compared between the two stocks.
About Hallador Energy
Hallador Energy Company is an oil and gas exploration company focused on developing coal reserves in the Illinois Basin. The Company, through its subsidiary, Sunrise Coal, LLC, is engaged in coal mining in the state of Indiana serving the electric power generation industry. Its projects include Carlisle Mine, Ace in the Hole Mine, Oaktown 1 Mine, Oaktown 2 Mine and Bulldog Mine. It develops over 10 million tons of coal annually and has customers in the mid-west and southeastern United States. It has over 40.6 million tons of the Indiana coal V seam. It also has over 69.3 million controlled tons in both Knox County, Indiana and Lawrence County, Illinois. Its Carlisle underground coal mine is located near the town of Carlisle, Indiana in Sullivan County. The Ace mine is located approximately 40 miles northeast of the Carlisle Mine. Its Bulldog Mine controls over 35.8 million tons of coal reserves.
About SunCoke Energy Partners
SunCoke Energy Partners, L.P. is engaged in the production of coke used in the blast furnace production of steel. As of December 31, 2016, the Company owned a 98% interest in Haverhill Coke Company LLC (Haverhill), Middletown Coke Company, LLC (Middletown), and Gateway Energy and Coke Company, LLC (Granite City). The Company’s segments include Domestic Coke, which consists of the Haverhill, Middletown and Granite City cokemaking and heat recovery operations located in Franklin Furnace, Ohio; Middletown, Ohio, and Granite City, Illinois, respectively, and Coal Logistics, which consists of the Company’s Convent Marine Terminal, Kanawha River Terminals, LLC and SunCoke Lake Terminal, LLC (Lake Terminal) coal handling and/or mixing service operations in Convent, Louisiana; Ceredo and Belle, West Virginia, and East Chicago, Indiana, respectively. It also provides coal handling and/or mixing services at its Coal Logistics terminals to steel, coke, electric utility and coal mining customers.
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