Western Refining Logistics (NYSE: WNRL) and Shell Midstream Partners (NYSE:SHLX) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, analyst recommendations and risk.
Western Refining Logistics pays an annual dividend of $1.87 per share and has a dividend yield of 7.8%. Shell Midstream Partners pays an annual dividend of $1.33 per share and has a dividend yield of 5.2%. Western Refining Logistics pays out 174.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Shell Midstream Partners pays out 104.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Refining Logistics has raised its dividend for 2 consecutive years and Shell Midstream Partners has raised its dividend for 3 consecutive years.
This table compares Western Refining Logistics and Shell Midstream Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Western Refining Logistics||2.98%||62.93%||13.13%|
|Shell Midstream Partners||85.14%||3,826.80%||27.98%|
Valuation and Earnings
This table compares Western Refining Logistics and Shell Midstream Partners’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Western Refining Logistics||N/A||N/A||N/A||$1.07||22.29|
|Shell Midstream Partners||$291.30 million||19.55||$244.90 million||$1.27||20.03|
Shell Midstream Partners has higher revenue and earnings than Western Refining Logistics. Shell Midstream Partners is trading at a lower price-to-earnings ratio than Western Refining Logistics, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
40.1% of Western Refining Logistics shares are held by institutional investors. Comparatively, 45.1% of Shell Midstream Partners shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Volatility & Risk
Western Refining Logistics has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Shell Midstream Partners has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Western Refining Logistics and Shell Midstream Partners, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Western Refining Logistics||0||0||0||0||N/A|
|Shell Midstream Partners||0||3||3||0||2.50|
Shell Midstream Partners has a consensus price target of $32.33, suggesting a potential upside of 27.10%. Given Shell Midstream Partners’ higher probable upside, analysts clearly believe Shell Midstream Partners is more favorable than Western Refining Logistics.
Shell Midstream Partners beats Western Refining Logistics on 11 of the 13 factors compared between the two stocks.
Western Refining Logistics Company Profile
Western Refining Logistics, LP owns, operates, develops, and acquires logistics and related assets and businesses to include terminals, storage tanks, pipelines and other logistics assets related to the terminaling, transportation, storage and distribution of crude oil and refined products. The Company’s segments include logistics and wholesale. The Company operates its logistics business and wholesale business under commercial and service agreements with Western Refining, Inc. (Western). Its logistics assets consist of pipeline and gathering infrastructure and terminalling, transportation and storage assets in the Southwest and the Upper Great Plains region. Its wholesale business purchases its petroleum fuels from Western, and its lubricants and additional petroleum fuels from third-party suppliers.
Shell Midstream Partners Company Profile
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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