Hess Midstream Partners (NYSE:HESM) and Isramco (NASDAQ:ISRL) 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 risk, analyst recommendations, dividends, valuation, profitability, earnings and institutional ownership.

Profitability

This table compares Hess Midstream Partners and Isramco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hess Midstream Partners 10.43% 2.62% 2.52%
Isramco 19.95% -194.85% 15.13%

Analyst Recommendations

This is a summary of recent ratings for Hess Midstream Partners and Isramco, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hess Midstream Partners 0 2 4 0 2.67
Isramco 0 0 0 0 N/A

Hess Midstream Partners presently has a consensus price target of $25.60, indicating a potential upside of 25.68%. Given Hess Midstream Partners’ higher possible upside, research analysts plainly believe Hess Midstream Partners is more favorable than Isramco.

Risk & Volatility

Hess Midstream Partners has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500. Comparatively, Isramco has a beta of 0.36, suggesting that its stock price is 64% less volatile than the S&P 500.

Dividends

Hess Midstream Partners pays an annual dividend of $1.53 per share and has a dividend yield of 7.5%. Isramco does not pay a dividend. Hess Midstream Partners pays out 120.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider & Institutional Ownership

48.2% of Hess Midstream Partners shares are owned by institutional investors. Comparatively, 5.0% of Isramco shares are owned by institutional investors. 73.3% of Isramco shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Hess Midstream Partners and Isramco’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hess Midstream Partners $662.40 million 0.84 $372.30 million $1.27 16.04
Isramco $81.34 million 4.06 $17.93 million N/A N/A

Hess Midstream Partners has higher revenue and earnings than Isramco.

Summary

Hess Midstream Partners beats Isramco on 8 of the 14 factors compared between the two stocks.

About Hess Midstream Partners

Hess Midstream Partners LP owns, operates, develops, and acquires midstream assets to provide services to Hess and third-party customers in the United States. It operates through three segments: Gathering, Processing and Storage, and Terminaling and Export. The Gathering segment is involved in the natural gas and crude oil gathering and compression activities located primarily in McKenzie, Williams and Mountrail Counties, and North Dakota. Its gathering systems consists of approximately 1,200 miles of high and low pressure natural gas and natural gas liquids gathering pipelines with capacity of up to 370 million cubic feet per day approximately, including an aggregate compression capacity of 190 million cubic feet per day; and crude oil gathering system comprises approximately 400 miles of crude oil gathering pipelines with capacity of up to 160 thousand barrels per day. The Processing and Storage segment operates Tioga Gas Plant, a natural gas processing and fractionation plant located in Tioga, North Dakota; and Mentor storage terminal, a propane storage cavern and rail, and truck loading and unloading facility located in Mentor, Minnesota. The Terminaling and Export segment owns Ramberg terminal facility; Tioga rail terminal; and crude oil rail cars, as well as Johnson's Corner Header System, a crude oil pipeline header system. Hess Midstream Partners LP was founded in 2014 and is based in Houston, Texas.

About Isramco

Isramco, Inc., an independent oil and natural gas company, engages in the exploration, development, and production of oil and natural gas properties located onshore in the United States and offshore Israel. It operates in two segments, Oil and Gas Exploration and Production; and Production Services. The Oil and Gas Exploration and Production segment owns working interests in oil and gas wells in Louisiana, Texas, New Mexico, Oklahoma, Wyoming, Utah, and Colorado; and operates approximately 422 producing wells located primarily in Texas and New Mexico. It also has overriding royalty interests in the Tamar Field located in offshore Israel. This segment sells its oil and natural gas to independent marketers, oil and natural gas companies, and gas pipeline companies. The Production Services segment operates a fleet of production servicing rigs and trucks that provide a range of production services, including completion of newly-drilled wells; maintenance and workover of existing wells; fluid transportation; and related oilfield services, as well as plugging and abandonment of wells to oil and gas exploration and production companies. As of December 31, 2018, the company had estimated total proved oil, natural gas reserves, and natural gas liquids, which include approximately 40,267 thousand barrels (MBbls) of oil equivalent comprising 2,125 MBbls of oil; 223,915 million cubic feet of natural gas; and 823 MBbls of natural gas liquids, as well as 33 production servicing rigs primarily in Texas and New Mexico. Isramco, Inc. was founded in 1982 and is based in Houston, Texas.

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