Suncor Energy (NYSE: SU) and Arc Logistic Partners (NYSE:ARCX) are both oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, profitability, dividends, valuation, analyst recommendations and earnings.

Insider & Institutional Ownership

64.1% of Suncor Energy shares are owned by institutional investors. Comparatively, 42.9% of Arc Logistic Partners shares are owned by institutional investors. 1.0% of Suncor Energy shares are owned 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.

Valuation & Earnings

This table compares Suncor Energy and Arc Logistic Partners’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Suncor Energy $20.20 billion 2.98 $327.75 million $1.66 21.94
Arc Logistic Partners $105.38 million 3.04 $15.04 million $0.49 33.39

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

Dividends

Suncor Energy pays an annual dividend of $1.03 per share and has a dividend yield of 2.8%. Arc Logistic Partners pays an annual dividend of $1.76 per share and has a dividend yield of 10.8%. Suncor Energy pays out 62.0% of its earnings in the form of a dividend. Arc Logistic Partners pays out 359.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Suncor Energy has increased its dividend for 2 consecutive years.

Profitability

This table compares Suncor Energy and Arc Logistic Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Suncor Energy 11.63% 5.68% 2.91%
Arc Logistic Partners 9.13% 3.26% 1.81%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Suncor Energy and Arc Logistic Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Suncor Energy 0 3 13 1 2.88
Arc Logistic Partners 0 3 0 0 2.00

Suncor Energy presently has a consensus price target of $44.30, suggesting a potential upside of 21.63%. Arc Logistic Partners has a consensus price target of $16.50, suggesting a potential upside of 0.86%. Given Suncor Energy ‘s stronger consensus rating and higher possible upside, research analysts plainly believe Suncor Energy is more favorable than Arc Logistic Partners.

Risk & Volatility

Suncor Energy has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, Arc Logistic Partners has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Summary

Suncor Energy beats Arc Logistic Partners on 16 of the 18 factors compared between the two stocks.

Suncor Energy Company Profile

Suncor Energy Inc is a Canada-based integrated energy company. The Company is focused on developing Canada’s petroleum resource basin, Athabasca oil sands. The Company operates in three business segments: Oil Sands, Exploration and Production (E&P), and Refining and Marketing. The Company’s Oil Sands segment includes Oil Sands operations and Oil Sands ventures operations. Its E&P segment consists of offshore operations off the east coast of Canada and in the North Sea, and onshore assets in North America, Libya and Syria. The Company’s Refining and Marketing segment is engaged in Refining and Supply, and Marketing operations. In addition, it explores for, acquires, develops, produces and markets crude oil and natural gas in Canada and internationally. It transports and refines crude oil, and markets petroleum and petrochemical products primarily in Canada. It markets third-party petroleum products. The Company also conducts energy trading activities.

Arc Logistic Partners Company Profile

Arc Logistics Partners LP owns, operates, develops and acquires a portfolio of energy logistics assets. The Company is engaged in the terminaling, storage, throughput and transloading of crude oil and petroleum products. The Company is focused on growing its business through the optimization, organic development and acquisition of terminaling, storage, rail, pipeline and other energy logistics assets. As of March 6, 2017, the Company’s energy logistics assets were located in the East Coast, Gulf Coast, Midwest, Rocky Mountains and West Coast regions of the United States and supplied a group of third-party customers, including oil companies, independent refiners, crude oil and petroleum product marketers, distributors and various industrial manufacturers. As of December 31, 2016, its assets consisted of 21 terminals in 12 states; four rail transloading facilities, and the liquefied natural gas (LNG) Interest in connection with the LNG Facility.

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