Enable Midstream Partners (NYSE: ENBL) and Buckeye Partners (NYSE:BPL) are both mid-cap oils/energy companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, analyst recommendations, risk, valuation, institutional ownership and earnings.

Institutional & Insider Ownership

18.2% of Enable Midstream Partners shares are held by institutional investors. Comparatively, 70.2% of Buckeye Partners shares are held by institutional investors. 0.4% of Buckeye Partners shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Enable Midstream Partners has a beta of 1.92, meaning that its stock price is 92% more volatile than the S&P 500. Comparatively, Buckeye Partners has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500.

Dividends

Enable Midstream Partners pays an annual dividend of $1.27 per share and has a dividend yield of 8.2%. Buckeye Partners pays an annual dividend of $5.05 per share and has a dividend yield of 9.2%. Enable Midstream Partners pays out 151.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Buckeye Partners pays out 154.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Buckeye Partners has raised its dividend for 15 consecutive years. Buckeye Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations for Enable Midstream Partners and Buckeye Partners, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enable Midstream Partners 0 6 3 0 2.33
Buckeye Partners 1 7 2 0 2.10

Enable Midstream Partners currently has a consensus price target of $17.85, suggesting a potential upside of 15.16%. Buckeye Partners has a consensus price target of $65.00, suggesting a potential upside of 18.35%. Given Buckeye Partners’ higher possible upside, analysts clearly believe Buckeye Partners is more favorable than Enable Midstream Partners.

Valuation and Earnings

This table compares Enable Midstream Partners and Buckeye Partners’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enable Midstream Partners $2.27 billion 2.95 $312.00 million $0.84 18.45
Buckeye Partners $3.25 billion 2.48 $535.60 million $3.26 16.85

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

Profitability

This table compares Enable Midstream Partners and Buckeye Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enable Midstream Partners 14.82% 5.24% 3.46%
Buckeye Partners 12.69% 9.72% 4.69%

Summary

Buckeye Partners beats Enable Midstream Partners on 10 of the 17 factors compared between the two stocks.

Enable Midstream Partners Company Profile

Enable Midstream Partners LP owns, operates and develops midstream energy infrastructure assets strategically located to serve its customers. The Company operates in two business segments: Gathering and Processing, and Transportation and Storage. Its gathering and processing segment primarily provides natural gas and crude oil gathering and natural gas processing services to its producer customers. Its transportation and storage segment provides interstate and intrastate natural gas pipeline transportation and storage services primarily to its producer, power plant, Local distribution company (LDC) and industrial end user customers. As of December 31, 2016, the Company owned and operated natural gas and crude oil gathering and natural gas processing assets in five states. As of December 31, 2016, the Company owned and operated interstate and intrastate transportation and storage systems across nine states.

Buckeye Partners Company Profile

Buckeye Partners, L.P. (Buckeye) owns and operates a network of integrated assets providing midstream logistic solutions, primarily consisting of the transportation, storage, processing and marketing of liquid petroleum products. Its segments include Domestic Pipelines & Terminals, Global Marine Terminals and Merchant Services. As of December 31, 2016, the Domestic Pipelines & Terminals segment owned and operated approximately 6,000 miles of pipeline located primarily in the northeastern and upper Midwestern portions of the United States, and serviced approximately 110 delivery locations. The Global Marine Terminals segment provides marine accessible bulk storage and blending services, rail and truck rack loading/unloading, along with petroleum processing services in the East Coast and Gulf Coast regions of the United States and in the Caribbean. The Merchant Services segment is a wholesale distributor of petroleum products in the continental United States and in the Caribbean.

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