Critical Contrast: MV Oil Trust (MVO) vs. Williams Partners (WPZ)

MV Oil Trust (NYSE: MVO) and Williams Partners (NYSE:WPZ) are both oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Profitability

This table compares MV Oil Trust and Williams Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MV Oil Trust 90.96% N/A 46.68%
Williams Partners 10.87% 6.35% 3.37%

Analyst Ratings

This is a summary of recent ratings and target prices for MV Oil Trust and Williams Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MV Oil Trust 0 0 0 0 N/A
Williams Partners 0 2 8 0 2.80

Williams Partners has a consensus target price of $46.22, indicating a potential upside of 18.58%. Given Williams Partners’ higher possible upside, analysts clearly believe Williams Partners is more favorable than MV Oil Trust.

Dividends

MV Oil Trust pays an annual dividend of $0.88 per share and has a dividend yield of 12.0%. Williams Partners pays an annual dividend of $2.40 per share and has a dividend yield of 6.2%. MV Oil Trust pays out 115.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Williams Partners pays out 171.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MV Oil Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares MV Oil Trust and Williams Partners’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
MV Oil Trust $5.50 million 15.31 $4.60 million $0.76 9.63
Williams Partners $8.01 billion 4.74 $871.00 million $1.40 27.84

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

Risk & Volatility

MV Oil Trust has a beta of 0.06, suggesting that its stock price is 94% less volatile than the S&P 500. Comparatively, Williams Partners has a beta of 1.43, suggesting that its stock price is 43% more volatile than the S&P 500.

Insider & Institutional Ownership

9.9% of MV Oil Trust shares are held by institutional investors. Comparatively, 21.8% of Williams Partners shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Williams Partners beats MV Oil Trust on 9 of the 14 factors compared between the two stocks.

MV Oil Trust Company Profile

MV Oil Trust (the Trust) is a statutory trust. The Trust acquires and holds a term net profits interest for the benefit of the Trust unitholders. Its underlying properties consist of MV Partners, LLC’s (MV Partners) net interests in all of its oil and natural gas properties, which are located in the Mid-Continent region in the States of Kansas and Colorado. These oil and gas properties include approximately 1,000 producing oil and gas wells. The underlying properties located in the El Dorado Area are operated on behalf of MV Partners by Vess Oil Corporation (Vess Oil) and are located in the El Dorado, Augusta and Valley Center Fields. Each of Vess Oil and Murfin Drilling Company, Inc. (Murfin Drilling) operate leases on behalf of MV Partners included in the underlying properties that are located in the Northwest Kansas Area. The primary fields in this area are the Bemis-Shutts, Trapp, Ray and Hansen Fields.

Williams Partners Company Profile

Williams Partners L.P. is an energy infrastructure company. The Company has operations across the natural gas value chain from gathering, processing, and interstate transportation of natural gas and natural gas liquids to petchem production of ethylene, propylene, and other olefins. It operates through its Northeast G&P, Atlantic-Gulf, West segment. Under the Northeast G&P segment, it owns and operates fractionation facilities at Moundsville, de-ethanization and condensate facilities at its Oak Grove processing plant. The Atlantic Gulf segment includes the Company’s interstate natural gas pipeline, Transcontinental Gas Pipe Line Company, LLC. The West segment includes its interstate natural gas pipeline, Northwest Pipeline, and natural gas gathering processing and treating operations.

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