Contrasting Enterprise Products (EPD) and Antero Midstream Partners (AM)

Enterprise Products (NYSE: EPD) and Antero Midstream Partners (NYSE:AM) are both oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, earnings, dividends, profitability, analyst recommendations, valuation and risk.

Analyst Ratings

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This is a summary of current recommendations for Enterprise Products and Antero Midstream Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enterprise Products 0 0 16 0 3.00
Antero Midstream Partners 0 1 11 0 2.92

Enterprise Products presently has a consensus target price of $30.82, suggesting a potential upside of 15.65%. Antero Midstream Partners has a consensus target price of $35.92, suggesting a potential upside of 33.02%. Given Antero Midstream Partners’ higher possible upside, analysts plainly believe Antero Midstream Partners is more favorable than Enterprise Products.

Earnings & Valuation

This table compares Enterprise Products and Antero Midstream Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enterprise Products $29.24 billion 1.97 $2.80 billion $1.32 20.19
Antero Midstream Partners $772.50 million 6.53 $307.31 million $1.40 19.29

Enterprise Products has higher revenue and earnings than Antero Midstream Partners. Antero Midstream Partners is trading at a lower price-to-earnings ratio than Enterprise Products, indicating that it is currently the more affordable of the two stocks.

Dividends

Enterprise Products pays an annual dividend of $1.70 per share and has a dividend yield of 6.4%. Antero Midstream Partners pays an annual dividend of $1.46 per share and has a dividend yield of 5.4%. Enterprise Products pays out 128.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Antero Midstream Partners pays out 104.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Enterprise Products has increased its dividend for 19 consecutive years and Antero Midstream Partners has increased its dividend for 2 consecutive years. Enterprise Products is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Enterprise Products has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, Antero Midstream Partners has a beta of 1.79, suggesting that its stock price is 79% more volatile than the S&P 500.

Institutional and Insider Ownership

36.4% of Enterprise Products shares are held by institutional investors. Comparatively, 49.5% of Antero Midstream Partners shares are held by institutional investors. 37.5% of Enterprise Products shares are held by company insiders. Comparatively, 7.9% of Antero Midstream Partners shares are held by company 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.

Profitability

This table compares Enterprise Products and Antero Midstream Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enterprise Products 9.57% 12.52% 5.41%
Antero Midstream Partners 32.74% 18.34% 9.83%

Summary

Antero Midstream Partners beats Enterprise Products on 9 of the 17 factors compared between the two stocks.

About Enterprise Products

Enterprise Products Partners L.P. provides midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals, and refined products. The company operates through four segments: NGL Pipelines & Services, Crude Oil Pipelines & Services, Natural Gas Pipelines & Services, and Petrochemical & Refined Products Services. The NGL Pipelines & Services segment offers natural gas processing and related NGL marketing services, as well as NGL export docks and related services. It operates approximately 19,600 miles of NGL pipelines; NGL and related product storage facilities; 14 NGL fractionators; and a liquefied petroleum gas and ethane export terminals, and related operations. The Crude Oil Pipelines & Services segment operates approximately 5,800 miles of crude oil pipelines; and crude oil storage and marine terminals located in Oklahoma and Texas, as well as a fleet of 495 tractor-trailer tank trucks used to transport crude oil. It also engages in crude oil marketing activities. The Natural Gas Pipelines & Services segment operates approximately 19,700 miles of natural gas pipeline systems to gather and transport natural gas in Colorado, Louisiana, New Mexico, Texas, and Wyoming. It leases underground salt dome natural gas storage facilities in Texas and Louisiana; owns an underground salt dome storage cavern in Texas; and markets natural gas. The Petrochemical & Refined Products Services segment operates propylene fractionation and related activities, including 800 miles of pipelines; butane isomerization complex, associated deisobutanizer units, and related pipeline assets; and octane enhancement and high purity isobutylene production facilities. It also operates approximately 4,100 miles of refined products pipelines; and terminals, as well as provides refined products marketing and marine transportation services. The company was founded in 1968 and is headquartered in Houston, Texas.

About Antero Midstream Partners

Antero Midstream Partners LP owns, operates, and develops midstream energy assets. The company operates in two segments, Gathering and Processing, and Water Handling and Treatment. Its assets include 8-, 12-, 16-, 20-, 24-, and 30-inch high and low pressure gathering pipelines, compressor stations, and processing and fractionation plants that collect and process natural gas, natural gas liquids, and crude oil from wells in the Marcellus Shale in West Virginia and the Utica Shale in Ohio; and water handling and treatment assets, which comprise two independent fresh water delivery systems that deliver fresh water from the Ohio River and several regional waterways, as well as wastewater handling services for well completion operations. As of December 31, 2017, the company's Marcellus and Utica Shale water handling and treatment systems included 190 miles and 83 miles of pipelines, respectively; and gathering systems comprised 242 miles and 123 miles of pipelines, respectively. Antero Midstream Partners GP LLC serves as the general partner of the company. The company was founded in 2013 and is headquartered in Denver, Colorado. Antero Midstream Partners LP is a subsidiary of Antero Resources Corporation.

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