Williams Partners (NYSE: WPZ) and W&T Offshore (NYSE:WTI) are both oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, risk, valuation and profitability.
Institutional and Insider Ownership
23.6% of Williams Partners shares are held by institutional investors. Comparatively, 49.1% of W&T Offshore shares are held by institutional investors. 32.6% of W&T Offshore shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Earnings & Valuation
This table compares Williams Partners and W&T Offshore’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Williams Partners||$8.00 billion||4.51||$3.78 billion||$1.67||22.60|
|W&T Offshore||$468.38 million||0.54||$252.78 million||$1.01||1.83|
Williams Partners has higher revenue and earnings than W&T Offshore. W&T Offshore is trading at a lower price-to-earnings ratio than Williams Partners, indicating that it is currently the more affordable of the two stocks.
This table compares Williams Partners and W&T Offshore’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk & Volatility
Williams Partners has a beta of 1.43, indicating that its share price is 43% more volatile than the S&P 500. Comparatively, W&T Offshore has a beta of 2.4, indicating that its share price is 140% more volatile than the S&P 500.
This is a summary of recent ratings and recommmendations for Williams Partners and W&T Offshore, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Williams Partners currently has a consensus price target of $44.67, indicating a potential upside of 18.35%. W&T Offshore has a consensus price target of $2.63, indicating a potential upside of 41.89%. Given W&T Offshore’s higher possible upside, analysts clearly believe W&T Offshore is more favorable than Williams Partners.
Williams Partners pays an annual dividend of $2.40 per share and has a dividend yield of 6.4%. W&T Offshore does not pay a dividend. Williams Partners pays out 143.7% 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 has raised its dividend for 5 consecutive years.
Williams Partners beats W&T Offshore on 11 of the 18 factors compared between the two stocks.
About Williams Partners
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.
About W&T Offshore
W&T Offshore, Inc. is an independent oil and natural gas producer. The Company is engaged in the exploration, development and acquisition of oil and natural gas properties in the Gulf of Mexico. As of December 31, 2016, the Company had interests in offshore leases covering approximately 750,000 gross acres (450,000 net acres) spanning across the Outer Continental Shelf (OCS) off the coasts of Louisiana, Texas, Mississippi and Alabama. Its producing fields are located in federal and state waters in the Gulf of Mexico in water depths ranging from less than 10 feet up to 7,300 feet. Its fields include Ship Shoal 349 Field (Mahogany), Fairway Field, Viosca Knoll 783 Field (Viosca Knoll 783 (Tahoe) and Viosca Knoll 784 (SE Tahoe)), Mississippi Canyon 782 Field (Dantzler), Mississippi Canyon 698 Field (Big Bend), Mississippi Canyon 243 Field (Matterhorn), Ewing Bank 910, Brazos A-133 Field and Viosca Knoll 823 Field (Virgo).
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