Analyzing Dominion Cove Point LNG (DM) and Its Competitors

Dominion Cove Point LNG (NYSE: DM) is one of 33 public companies in the “Natural gas transmission” industry, but how does it contrast to its competitors? We will compare Dominion Cove Point LNG to similar businesses based on the strength of its profitability, institutional ownership, analyst recommendations, dividends, earnings, valuation and risk.

Profitability

This table compares Dominion Cove Point LNG and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dominion Cove Point LNG 25.34% 2.07% 1.57%
Dominion Cove Point LNG Competitors 19.00% 9.28% 4.77%

Dividends

Dominion Cove Point LNG pays an annual dividend of $1.27 per share and has a dividend yield of 8.8%. Dominion Cove Point LNG pays out 94.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Natural gas transmission” companies pay a dividend yield of 7.5% and pay out 131.5% of their earnings in the form of a dividend. Dominion Cove Point LNG is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Risk & Volatility

Dominion Cove Point LNG has a beta of 1.94, meaning that its stock price is 94% more volatile than the S&P 500. Comparatively, Dominion Cove Point LNG’s competitors have a beta of 1.53, meaning that their average stock price is 53% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Dominion Cove Point LNG and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dominion Cove Point LNG 1 5 4 0 2.30
Dominion Cove Point LNG Competitors 361 1463 2029 73 2.46

Dominion Cove Point LNG currently has a consensus price target of $28.60, indicating a potential upside of 97.24%. As a group, “Natural gas transmission” companies have a potential upside of 35.76%. Given Dominion Cove Point LNG’s higher possible upside, equities research analysts plainly believe Dominion Cove Point LNG is more favorable than its competitors.

Earnings & Valuation

This table compares Dominion Cove Point LNG and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Dominion Cove Point LNG $480.20 million $195.10 million 10.74
Dominion Cove Point LNG Competitors $5.37 billion $750.70 million 35.32

Dominion Cove Point LNG’s competitors have higher revenue and earnings than Dominion Cove Point LNG. Dominion Cove Point LNG is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Insider & Institutional Ownership

55.8% of Dominion Cove Point LNG shares are held by institutional investors. Comparatively, 54.3% of shares of all “Natural gas transmission” companies are held by institutional investors. 11.2% of Dominion Cove Point LNG shares are held by company insiders. Comparatively, 6.9% of shares of all “Natural gas transmission” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Dominion Cove Point LNG competitors beat Dominion Cove Point LNG on 8 of the 15 factors compared.

About Dominion Cove Point LNG

Dominion Energy Midstream Partners, LP owns liquefied natural gas (LNG) terminalling, storage, regasification, and transportation assets. It owns and operates LNG terminalling and storage facility located on the Chesapeake Bay in Lusby, Maryland. The company also operates an interstate pipeline in South Carolina and southeastern Georgia comprising natural gas system consisting of approximately 1,500 miles of transmission pipeline and 5 compressor stations with approximately 34,500 installed compressor horsepower. In addition, it owns and operates a 416-mile interstate natural gas pipeline from the United States-Canadian border at Waddington, New York through the state of Connecticut to South Commack, Long Island, New York and continuing on from Northport, Long Island, New York through the Long Island Sound to Hunts Point, Bronx, New York providing service to local gas distribution companies, electric utilities, and electric power generators, as well as marketers and other end users through interconnecting pipelines and exchanges. Further, the company operates 2,200 miles of natural gas transportation pipelines in northeastern and central Utah, northwestern Colorado, and southwestern Wyoming. Dominion Energy Midstream GP, LLC serves as a general partner of the company. The company was founded in 2000 and is headquartered in Richmond, Virginia.

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