TC Pipelines (NYSE: TCP) is one of 49 public companies in the “OIL/GAS PROD/PIPEL” industry, but how does it contrast to its peers? We will compare TC Pipelines to similar businesses based on the strength of its risk, profitability, earnings, valuation, dividends, institutional ownership and analyst recommendations.

Dividends

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TC Pipelines pays an annual dividend of $4.00 per share and has a dividend yield of 11.5%. TC Pipelines pays out 126.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “OIL/GAS PROD/PIPEL” companies pay a dividend yield of 8.5% and pay out 193.3% of their earnings in the form of a dividend. TC Pipelines has increased its dividend for 8 consecutive years. TC Pipelines is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Risk & Volatility

TC Pipelines has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500. Comparatively, TC Pipelines’ peers have a beta of 1.16, suggesting that their average share price is 16% more volatile than the S&P 500.

Institutional and Insider Ownership

66.0% of TC Pipelines shares are held by institutional investors. Comparatively, 53.6% of shares of all “OIL/GAS PROD/PIPEL” companies are held by institutional investors. 0.1% of TC Pipelines shares are held by company insiders. Comparatively, 12.4% of shares of all “OIL/GAS PROD/PIPEL” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares TC Pipelines and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
TC Pipelines $422.00 million $252.00 million 11.05
TC Pipelines Competitors $6.65 billion $474.67 million 21.24

TC Pipelines’ peers have higher revenue and earnings than TC Pipelines. TC Pipelines is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares TC Pipelines and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TC Pipelines 62.66% 22.80% 7.23%
TC Pipelines Competitors 21.70% 3.57% 6.08%

Analyst Ratings

This is a breakdown of recent ratings for TC Pipelines and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TC Pipelines 2 4 2 0 2.00
TC Pipelines Competitors 488 2016 2483 89 2.43

TC Pipelines presently has a consensus target price of $52.57, suggesting a potential upside of 50.51%. As a group, “OIL/GAS PROD/PIPEL” companies have a potential upside of 36.84%. Given TC Pipelines’ higher probable upside, equities research analysts plainly believe TC Pipelines is more favorable than its peers.

Summary

TC Pipelines peers beat TC Pipelines on 8 of the 15 factors compared.

TC Pipelines Company Profile

TC PipeLines, LP is a master limited partnership. The Company acquires, owns and participates in the management of energy infrastructure businesses in North America. The Company’s pipeline systems transport natural gas in the United States. As of December 31, 2016, the Company had four pipelines and equity ownership interests in three natural gas interstate pipeline systems that are collectively designed to transport approximately 9.1 billion cubic feet per day of natural gas from producing regions and import facilities to market hubs and consuming markets primarily in the Western, Midwestern and Eastern United States. The Company’s pipeline systems include Gas Transmission Northwest LLC (GTN), Bison Pipeline LLC (Bison), North Baja Pipeline, LLC (North Baja), Tuscarora Gas Transmission Company (Tuscarora), Northern Border Pipeline Company (Northern Border), Portland Natural Gas Transmission System (PNGTS), and Great Lakes Gas Transmission Limited Partnership (Great Lakes).

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