Sunoco Logistics Partners (ETP) and Tallgrass Energy GP, (TEGP) Critical Contrast
Sunoco Logistics Partners (NYSE: ETP) and Tallgrass Energy GP, (NYSE:TEGP) are both mid-cap oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.
This is a breakdown of recent ratings and recommmendations for Sunoco Logistics Partners and Tallgrass Energy GP,, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Sunoco Logistics Partners||0||4||12||0||2.75|
|Tallgrass Energy GP,||1||5||4||0||2.30|
Sunoco Logistics Partners presently has a consensus target price of $25.77, indicating a potential upside of 58.00%. Tallgrass Energy GP, has a consensus target price of $30.11, indicating a potential upside of 29.45%. Given Sunoco Logistics Partners’ stronger consensus rating and higher possible upside, analysts clearly believe Sunoco Logistics Partners is more favorable than Tallgrass Energy GP,.
This table compares Sunoco Logistics Partners and Tallgrass Energy GP,’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Sunoco Logistics Partners||4.97%||5.88%||2.44%|
|Tallgrass Energy GP,||7.07%||2.46%||1.12%|
Insider and Institutional Ownership
56.6% of Sunoco Logistics Partners shares are held by institutional investors. Comparatively, 35.8% of Tallgrass Energy GP, shares are held by institutional investors. 0.2% of Sunoco Logistics Partners shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Sunoco Logistics Partners pays an annual dividend of $2.26 per share and has a dividend yield of 13.9%. Tallgrass Energy GP, pays an annual dividend of $1.37 per share and has a dividend yield of 5.9%. Sunoco Logistics Partners pays out 337.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tallgrass Energy GP, pays out 171.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sunoco Logistics Partners has raised its dividend for 4 consecutive years. Sunoco Logistics Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares Sunoco Logistics Partners and Tallgrass Energy GP,’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Sunoco Logistics Partners||$9.15 billion||2.06||$705.00 million||$0.67||24.34|
|Tallgrass Energy GP,||$605.12 million||6.04||$26.79 million||$0.80||29.08|
Sunoco Logistics Partners has higher revenue and earnings than Tallgrass Energy GP,. Sunoco Logistics Partners is trading at a lower price-to-earnings ratio than Tallgrass Energy GP,, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Sunoco Logistics Partners has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Tallgrass Energy GP, has a beta of 2.08, indicating that its stock price is 108% more volatile than the S&P 500.
Sunoco Logistics Partners beats Tallgrass Energy GP, on 11 of the 17 factors compared between the two stocks.
About Sunoco Logistics Partners
Energy Transfer Partners, L.P., formerly Sunoco Logistics Partners L.P., owns and operates a logistics business. The Company is engaged in the transport, terminaling and storage of crude oil, refined products and natural gas liquids (NGLs). The Company’s segments include Crude Oil, Natural Gas Liquids and Refined Products. In addition to logistics services, it also owns acquisition and marketing assets. The Crude Oil segment provides transportation, terminaling and acquisition and marketing services to crude oil markets throughout the southwest, midwest and northeastern United States. The Natural Gas Liquids segment transports, stores, and executes acquisition and marketing activities utilizing a network of pipelines, storage and blending facilities, and strategic off-take locations that provide access to multiple NGL markets. The Refined Products segment provides transportation and terminaling services, using refined products pipelines and refined products marketing terminals.
About Tallgrass Energy GP,
Tallgrass Energy GP, LP is a limited partnership company, which includes the operations of Tallgrass Equity, LLC (Tallgrass Equity), Tallgrass MLP GP, LLC, Tallgrass Energy Partners, LP (TEP), and TEP’s subsidiaries. TEP owns, operates, acquires and develops midstream energy assets in North America. TEP’s segments include Crude Oil Transportation & Logistics, which is engaged in the ownership and operation of a crude oil pipeline system, and crude oil storage and terminaling facilities; Natural Gas Transportation & Logistics, which is engaged in the ownership and operation of interstate natural gas pipelines and integrated natural gas storage facilities; Processing & Logistics, which is engaged in the ownership and operation of natural gas processing, treating and fractionation facilities, and the provision of water business services to the oil and gas exploration and production industry, and Corporate and Other.
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