Analyzing Andeavor (ANDV) and Trecora Resources (TREC)

Andeavor (NYSE: ANDV) and Trecora Resources (NYSE:TREC) are both oils/energy companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, analyst recommendations, institutional ownership, valuation, earnings and profitability.

Dividends

Andeavor pays an annual dividend of $2.36 per share and has a dividend yield of 1.8%. Trecora Resources does not pay a dividend. Andeavor pays out 36.5% of its earnings in the form of a dividend.

Volatility & Risk

Andeavor has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500. Comparatively, Trecora Resources has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Earnings and Valuation

This table compares Andeavor and Trecora Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Andeavor $34.98 billion 0.56 $1.53 billion $6.47 20.08
Trecora Resources $245.14 million 1.44 $18.00 million $0.44 32.95

Andeavor has higher revenue and earnings than Trecora Resources. Andeavor is trading at a lower price-to-earnings ratio than Trecora Resources, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

81.1% of Andeavor shares are owned by institutional investors. Comparatively, 43.3% of Trecora Resources shares are owned by institutional investors. 7.0% of Andeavor shares are owned by insiders. Comparatively, 6.4% of Trecora Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Andeavor and Trecora Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Andeavor 4.27% 6.51% 2.99%
Trecora Resources 7.22% 4.32% 2.42%

Analyst Recommendations

This is a summary of current recommendations for Andeavor and Trecora Resources, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Andeavor 0 9 6 0 2.40
Trecora Resources 0 0 1 0 3.00

Andeavor presently has a consensus price target of $129.68, indicating a potential downside of 0.17%. Trecora Resources has a consensus price target of $16.00, indicating a potential upside of 10.34%. Given Trecora Resources’ stronger consensus rating and higher possible upside, analysts clearly believe Trecora Resources is more favorable than Andeavor.

Summary

Andeavor beats Trecora Resources on 9 of the 16 factors compared between the two stocks.

About Andeavor

Andeavor, through its subsidiaries, operates as an independent petroleum refining, logistics, and marketing company in the United States. The company operates in three segments: Marketing, Logistics, and Refining. The Marketing segment sells gasoline and diesel fuel through retail, branded, and unbranded channels. This segment operates a network of 3,255 retail stations under the ARCO, Shell, Mobil, and SUPERAMERICA brands. The Logistics segment gathers and transports crude oil by pipelines, as well as by trucks. It operates approximately 13 million barrels of crude oil, feedstock, blendstock, refined product, and asphalt storage tanks. The Refining segment buys and refines crude oil and other feed stocks into transportation fuels, such as gasoline and gasoline blend stocks, jet fuel, and diesel fuel, as well as other products, including heavy fuel oils, liquefied petroleum gas, petroleum coke, calcined coke, and asphalt. It also sells refined products in the bulk market principally to independent unbranded distributors, other refining and marketing companies, utilities, railroads, airlines, and marine and industrial end-users in the western United States. This segment owns and operates 10 petroleum refineries with a combined crude oil capacity of approximately 1,157 thousand barrels per day. The company was formerly known as Tesoro Corporation and changed its name to Andeavor in August 2017. Andeavor was founded in 1968 and is headquartered in San Antonio, Texas.

About Trecora Resources

Trecora Resources manufactures and sells various specialty petrochemical products and synthetic waxes in the United States. The company operates in two segments, Petrochemical and Specialty Waxes. The Petrochemical segment offers hydrocarbons and other petroleum based products, including isopentane, normal pentane, isohexane, and hexane for use in the production of polyethylene, packaging, polypropylene, expandable polystyrene, poly-iso/urethane foams, and crude oil from the Canadian tar sands, as well as in the catalyst support industry. It also owns and operates pipelines. The Specialty Waxes segment provides specialty polyethylene for use in the paints and inks, adhesives, coatings, and PVC lubricants markets; and specialized synthetic poly alpha olefin waxes for use as toner in printers, as well as additives for candles. The company also provides custom processing services; and produces copper and zinc concentrates, and silver and gold doré. Trecora Resources was formerly known as Arabian American Development Company and changed its name to Trecora Resources in June 2014. Trecora Resources was founded in 1967 and is based in Sugar Land, Texas.

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