Suburban Propane Partners, L.P. (NYSE: SPH) and American Midstream Partners, (NYSE:AMID) are both small-cap oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.
Suburban Propane Partners, L.P. pays an annual dividend of $3.55 per share and has a dividend yield of 13.4%. American Midstream Partners, pays an annual dividend of $1.65 per share and has a dividend yield of 12.5%. Suburban Propane Partners, L.P. pays out 788.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. American Midstream Partners, pays out -87.3% of its earnings in the form of a dividend. Suburban Propane Partners, L.P. has raised its dividend for 2 consecutive years. Suburban Propane Partners, L.P. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk and Volatility
Suburban Propane Partners, L.P. has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500. Comparatively, American Midstream Partners, has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500.
Earnings and Valuation
This table compares Suburban Propane Partners, L.P. and American Midstream Partners,’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Suburban Propane Partners, L.P.||$1.15 billion||1.41||$229.21 million||$0.45||58.87|
|American Midstream Partners,||$296.02 million||2.34||$12.92 million||($1.89)||-6.96|
Suburban Propane Partners, L.P. has higher revenue and earnings than American Midstream Partners,. American Midstream Partners, is trading at a lower price-to-earnings ratio than Suburban Propane Partners, L.P., indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
25.4% of Suburban Propane Partners, L.P. shares are held by institutional investors. Comparatively, 42.1% of American Midstream Partners, shares are held by institutional investors. 0.6% of Suburban Propane Partners, L.P. shares are held by insiders. Comparatively, 5.4% of American Midstream Partners, shares are held 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.
This table compares Suburban Propane Partners, L.P. and American Midstream Partners,’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Suburban Propane Partners, L.P.||2.46%||4.09%||1.25%|
|American Midstream Partners,||-10.35%||-19.39%||-3.16%|
This is a breakdown of current ratings for Suburban Propane Partners, L.P. and American Midstream Partners,, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Suburban Propane Partners, L.P.||1||1||1||0||2.00|
|American Midstream Partners,||0||2||1||0||2.33|
Suburban Propane Partners, L.P. currently has a consensus target price of $27.33, indicating a potential upside of 3.18%. American Midstream Partners, has a consensus target price of $16.33, indicating a potential upside of 24.21%. Given American Midstream Partners,’s stronger consensus rating and higher probable upside, analysts clearly believe American Midstream Partners, is more favorable than Suburban Propane Partners, L.P..
Suburban Propane Partners, L.P. beats American Midstream Partners, on 8 of the 15 factors compared between the two stocks.
About Suburban Propane Partners, L.P.
Suburban Propane Partners, L.P. is a marketer and distributor of a range of products. The Company specializes in the distribution of propane, fuel oil and refined fuels, as well as the marketing of natural gas and electricity in deregulated markets. The Company’s segments include Propane, Fuel Oil and Refined Fuels, Natural Gas and Electricity, and All Other. In support of its marketing and distribution operations, the Company installs and services a range of home comfort equipment, particularly in the areas of heating and ventilation. The Company conducts its business through Suburban Propane, L.P., which operates its propane business and assets (the Operating Partnership), and its direct and indirect subsidiaries. As of September 24, 2016, it had sold approximately 414.8 million gallons of propane and 30.9 million gallons of fuel oil and refined fuels to retail customers. The Company owns and operates a propane storage facility in Elk Grove, California.
About American Midstream Partners,
American Midstream Partners, LP owns, operates, develops and acquires a portfolio of midstream energy assets. The Company provides midstream infrastructure that links producers of natural gas, crude oil, natural gas liquids (NGLs), condensate and specialty chemicals to numerous intermediate and end-use markets. Its segments include gathering and processing, transmission and terminals. Through its segments, it is engaged in the business of gathering, treating, processing, and transporting natural gas; gathering, transporting, storing, treating and fractionating NGLs; gathering, storing and transporting crude oil and condensates, and storing specialty chemical products. Its gathering and processing assets are primarily located in the Permian Basin of West Texas; the Cotton Valley/Haynesville Shale of East Texas; the Eagle Ford Shale of South Texas; the Bakken Shale of North Dakota, and offshore in the Gulf of Mexico.
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