Critical Review: Gazprom PAO (OGZPY) versus Pembina Pipeline (PBA)

Gazprom PAO (OTCMKTS: OGZPY) and Pembina Pipeline (NYSE:PBA) are both oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, earnings, risk, dividends and valuation.

Dividends

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Gazprom PAO pays an annual dividend of $0.21 per share and has a dividend yield of 4.4%. Pembina Pipeline pays an annual dividend of $1.68 per share and has a dividend yield of 5.5%. Pembina Pipeline pays out 126.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline has increased its dividend for 2 consecutive years. Pembina Pipeline is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Gazprom PAO and Pembina Pipeline’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gazprom PAO $91.67 billion 0.06 $14.27 billion N/A N/A
Pembina Pipeline $4.11 billion 3.74 $687.31 million $1.33 22.95

Gazprom PAO has higher revenue and earnings than Pembina Pipeline.

Volatility & Risk

Gazprom PAO has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500. Comparatively, Pembina Pipeline has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500.

Insider and Institutional Ownership

0.3% of Gazprom PAO shares are owned by institutional investors. Comparatively, 48.1% of Pembina Pipeline shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Gazprom PAO and Pembina Pipeline, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gazprom PAO 0 2 0 0 2.00
Pembina Pipeline 0 1 2 0 2.67

Profitability

This table compares Gazprom PAO and Pembina Pipeline’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gazprom PAO N/A N/A N/A
Pembina Pipeline 16.56% 10.07% 4.40%

Summary

Pembina Pipeline beats Gazprom PAO on 10 of the 14 factors compared between the two stocks.

Gazprom PAO Company Profile

Gazprom PAO operates gas pipeline systems. The Company’s principal activities include exploration and production of gas; transportation of gas; sales of gas within the Russian Federation and abroad; gas storage; production of crude oil and gas condensate; processing of oil, gas condensate and other hydrocarbons, and sales of refined products, and electric and heat energy generation and sales. The Company’s segments include Production of gas, Transportation, Distribution of gas, Gas storage, Production of crude oil and gas condensate, Refining, Electric and heat energy generation and sales, and Other. The Production of gas segment is engaged in the exploration and production of gas. The Transportation segment is engaged in the transportation of gas. The Distribution of gas segment is engaged in the sales of gas within the Russian Federation and abroad. The Gas storage segment is engaged in the storage of extracted and purchased gas in underground gas storages.

Pembina Pipeline Company Profile

Pembina Pipeline Corporation provides transportation and midstream services for the energy industry in North America. It operates through five segments: Conventional Pipelines, Oil Sands & Heavy Oil, Gas Services, Midstream, and Veresen. The Conventional Pipelines segment operates approximately 10,000 kilometers of pipeline network that transports hydrocarbon liquids and extends across Alberta and parts of British Columbia, Saskatchewan, and North Dakota. The Oil Sands & Heavy Oil segment owns and operates the Nipisi and Mitsue pipelines, which provide transportation for producers operating in the Pelican Lake and Peace River heavy oil regions of Alberta; transports synthetic crude oil for the Syncrude Project and the Horizon Project to delivery points near Edmonton, Alberta; and operates Cheecham Lateral, which transports synthetic crude to oil sands producers operating southeast of Fort McMurray, Alberta. This segment operates approximately 1,650 kilometers of pipeline and has 1,060 thousands of barrels per day of capacity. The Gas Services segment provides natural gas gathering, compression, condensate stabilization, and shallow and deep cut processing services. The Midstream segment offers products and services, including storage, terminalling, and hub services. It operates 14 truck terminals; 21 inbound and 13 outbound pipeline connections; 1.2 mmbpd of crude oil and condensate supply; and approximately 900 mbbls of ground storage in the Edmonton North Terminal, as well as operates 2 NGL operating systems. The Veresen segment offers tariff-based operations of pipelines and related facilities; natural gas gathering and processing facilities; NGL fractionation facility and gas processing capacity near Chicago, Illinois; and other natural gas and NGL processing facilities, logistics, and distribution assets in the United States and Canada. Pembina Pipeline Corporation was founded in 1997 and is headquartered in Calgary, Canada.

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