Head-To-Head Contrast: Shell Midstream Partners, L.P. (SHLX) and The Competition

Shell Midstream Partners, L.P. (NYSE: SHLX) is one of 54 public companies in the “Oil & Gas Transportation Services” industry, but how does it weigh in compared to its peers? We will compare Shell Midstream Partners, L.P. to related companies based on the strength of its valuation, institutional ownership, analyst recommendations, risk, earnings, dividends and profitability.

Insider & Institutional Ownership

43.7% of Shell Midstream Partners, L.P. shares are owned by institutional investors. Comparatively, 57.3% of shares of all “Oil & Gas Transportation Services” companies are owned by institutional investors. 9.2% of shares of all “Oil & Gas Transportation Services” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Shell Midstream Partners, L.P. has a beta of 1.12, suggesting that its share price is 12% more volatile than the S&P 500. Comparatively, Shell Midstream Partners, L.P.’s peers have a beta of 1.37, suggesting that their average share price is 37% more volatile than the S&P 500.

Earnings and Valuation

This table compares Shell Midstream Partners, L.P. and its peers gross revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Shell Midstream Partners, L.P. $291.30 million $244.90 million 21.26
Shell Midstream Partners, L.P. Competitors $4.88 billion $288.25 million 45.93

Shell Midstream Partners, L.P.’s peers have higher revenue and earnings than Shell Midstream Partners, L.P.. Shell Midstream Partners, L.P. is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Dividends

Shell Midstream Partners, L.P. pays an annual dividend of $1.27 per share and has a dividend yield of 4.8%. Shell Midstream Partners, L.P. pays out 102.4% 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, “Oil & Gas Transportation Services” companies pay a dividend yield of 6.7% and pay out 154.0% of their earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current recommendations and price targets for Shell Midstream Partners, L.P. and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Shell Midstream Partners, L.P. 0 1 4 0 2.80
Shell Midstream Partners, L.P. Competitors 294 1784 2385 86 2.50

Shell Midstream Partners, L.P. currently has a consensus price target of $34.80, suggesting a potential upside of 32.02%. As a group, “Oil & Gas Transportation Services” companies have a potential upside of 25.86%. Given Shell Midstream Partners, L.P.’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Shell Midstream Partners, L.P. is more favorable than its peers.

Profitability

This table compares Shell Midstream Partners, L.P. and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Shell Midstream Partners, L.P. 87.22% 258.67% 28.64%
Shell Midstream Partners, L.P. Competitors 18.68% 14.73% 6.58%

Summary

Shell Midstream Partners, L.P. peers beat Shell Midstream Partners, L.P. on 8 of the 15 factors compared.

About Shell Midstream Partners, L.P.

Shell Midstream Partners, L.P. is a master limited partnership company, which owns, operates, develops and acquires pipelines and other midstream assets. The Company conducts its operations through its subsidiary, Shell Midstream Operating, LLC. Its assets consist of interests in entities that own crude oil and refined products pipelines serving as key infrastructure to transport onshore and offshore crude oil production to Gulf Coast and Midwest refining markets and to deliver refined products from those markets to demand centers. As of December 31, 2016, it owned interests in seven crude oil pipeline systems, three refined products systems, one natural gas gathering pipeline system and a crude tank storage and terminal system. Its pipeline and terminal systems include Zydeco crude oil system, Auger crude oil system, Mars crude oil system, Bengal product system, Poseidon crude oil system, Odyssey crude oil system, Proteus crude oil system and Endymion crude oil system.

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