Financial Comparison: Golar LNG (GLNG) vs. PAA Natural Gas Storage (PNG)

Golar LNG (NASDAQ: GLNG) and PAA Natural Gas Storage (NYSE:PNG) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Golar LNG and PAA Natural Gas Storage, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Golar LNG 0 1 6 0 2.86
PAA Natural Gas Storage 0 0 0 0 N/A

Golar LNG currently has a consensus price target of $34.60, suggesting a potential upside of 43.87%.

Earnings & Valuation

This table compares Golar LNG and PAA Natural Gas Storage’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Golar LNG $80.26 million 30.26 -$186.53 million ($1.86) -12.93
PAA Natural Gas Storage N/A N/A N/A $0.92 N/A

PAA Natural Gas Storage has lower revenue, but higher earnings than Golar LNG. Golar LNG is trading at a lower price-to-earnings ratio than PAA Natural Gas Storage, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

82.9% of Golar LNG shares are owned by institutional investors. 0.0% of Golar LNG shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Golar LNG pays an annual dividend of $0.20 per share and has a dividend yield of 0.8%. PAA Natural Gas Storage does not pay a dividend. Golar LNG pays out -10.8% of its earnings in the form of a dividend.

Profitability

This table compares Golar LNG and PAA Natural Gas Storage’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Golar LNG -180.90% -9.15% -3.78%
PAA Natural Gas Storage N/A N/A N/A

Summary

Golar LNG beats PAA Natural Gas Storage on 6 of the 10 factors compared between the two stocks.

About Golar LNG

Golar LNG Limited is a midstream liquefied natural gas (LNG) company engaged primarily in the transportation, regasification, liquefaction and trading of LNG. The Company is engaged in the acquisition, ownership, operation and chartering of LNG carriers and Floating Storage Regasification Unit (FSRUs) through its subsidiaries and affiliates, and the development of LNG projects, such as floating LNGs (FLNGs). The Company’s segments include Vessel operations, LNG trading and FLNG. Under the Vessel operations segment, the Company operates and charters out LNG carriers and FSRUs on fixed terms to customers. Through the LNG trading segment, the Company provides physical and financial risk management in LNG and gas markets for customers around the world. The FLNG segment includes the costs associated with the conversion of its LNG carrier, the Hilli, to a FLNG. The Company, along with its affiliate, Golar LNG Partners LP, has a combined fleet of approximately 30 vessels.

About PAA Natural Gas Storage

PAA Natural Gas Storage, L.P. is engaged in the business of acquisition, development, ownership, operation and commercial management of natural gas storage facilities. As of December 31, 2012, the Company owned and operated three natural gas storage facilities located in Louisiana, Mississippi and Michigan. The Company also leases storage capacity and pipelines transportation capacity from third parties. The Company provides natural gas storage services to a mix of customers, including local gas distribution company’s liquefied natural gas (LNG), electric utilities, pipelines, direct industrial users, electric power generators, marketers, producers, LNG exporters and affiliates of such entities. In December 31, 2013, Plains All American Pipeline, L.P. (Plains) completed the merger of PAA Natural Gas Storage, L.P with a wholly owned subsidiary of Plains, with Plains surviving the merger as a wholly owned subsidiary of PAA.

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