Western Refining (NYSE: WNR) and Northern Tier Energy (NYSE:NTI) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, earnings, valuation, institutional ownership, profitabiliy and analyst recommendations.

Dividends

Western Refining pays an annual dividend of $1.52 per share and has a dividend yield of 4.2%. Northern Tier Energy does not pay a dividend. Western Refining pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Refining has raised its dividend for 4 consecutive years and Northern Tier Energy has raised its dividend for 2 consecutive years.

Institutional and Insider Ownership

64.8% of Western Refining shares are held by institutional investors. 26.5% of Western Refining shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Western Refining and Northern Tier Energy’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Western Refining N/A N/A N/A $1.52 23.80
Northern Tier Energy N/A N/A N/A N/A N/A

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Western Refining and Northern Tier Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Western Refining 0 6 3 0 2.33
Northern Tier Energy 0 0 0 0 N/A

Western Refining presently has a consensus price target of $30.75, indicating a potential downside of 15.01%. Given Western Refining’s higher probable upside, equities analysts plainly believe Western Refining is more favorable than Northern Tier Energy.

Profitability

This table compares Western Refining and Northern Tier Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Western Refining 0.90% 2.76% 1.52%
Northern Tier Energy 1.69% 12.03% 4.34%

Summary

Western Refining beats Northern Tier Energy on 6 of the 10 factors compared between the two stocks.

About Western Refining

Western Refining, Inc. is an independent crude oil refiner and marketer of refined products. The Company operates through segments, including refining, Western Refining Logistics, LP (WNRL), retail and Other. As of December 31, 2016, the refining segment owned and operated three refineries that process crude oil and other feedstocks primarily into gasoline, diesel fuel, jet fuel and asphalt. The refining segment also sells refined products in the Mid-Atlantic region and Mexico. WNRL owns and operates terminal, storage, transportation and wholesale assets in the Southwest and terminal and storage assets in the Upper Great Plains region. The retail segment operates retail convenience stores and unmanned commercial fleet fueling (cardlock) locations located in the Southwest (Southwest Retail) and Upper Great Plains (SuperAmerica) regions. It markets refined products to a customer base, including wholesale distributors and retail chains.

About Northern Tier Energy

Northern Tier Energy LP is a downstream energy limited partnership. The Company has refining, retail and logistics operations that serve the Petroleum Administration for Defense District II (PADD II) region of the United States. It operates through two segments: the refining business and the retail business. Its refining segment consists of over 97,800 barrels per stream day refinery located in St. Paul Park, Minnesota. Its refineries process light, heavy, sweet and sour crudes into refined products. It also owns storage and transportation assets. The retail segment operates over 170 convenience stores and supports over 110 franchised convenience stores, which are operated under the SuperAmerica brand. These convenience stores are located throughout Minnesota, Wisconsin and South Dakota and sell various grades of gasoline and diesel, tobacco products and immediately consumable items, such as beverages, prepared food and a range of snacks and prepackaged items.

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