CNX Midstream Partners (CNXM) versus Murphy Oil (MUR) Head to Head Review

CNX Midstream Partners (NYSE: CNXM) and Murphy Oil (NYSE:MUR) are both oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Profitability

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This table compares CNX Midstream Partners and Murphy Oil’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CNX Midstream Partners 48.53% 15.38% 12.36%
Murphy Oil -14.31% -0.45% -0.22%

Valuation and Earnings

This table compares CNX Midstream Partners and Murphy Oil’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CNX Midstream Partners $233.85 million 5.11 $114.99 million $1.72 10.94
Murphy Oil $2.23 billion 1.96 -$311.78 million ($1.80) -14.06

CNX Midstream Partners has higher earnings, but lower revenue than Murphy Oil. Murphy Oil is trading at a lower price-to-earnings ratio than CNX Midstream Partners, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

CNX Midstream Partners has a beta of 1.88, suggesting that its stock price is 88% more volatile than the S&P 500. Comparatively, Murphy Oil has a beta of 2.39, suggesting that its stock price is 139% more volatile than the S&P 500.

Insider and Institutional Ownership

19.8% of CNX Midstream Partners shares are held by institutional investors. Comparatively, 97.0% of Murphy Oil shares are held by institutional investors. 6.9% of Murphy Oil shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

CNX Midstream Partners pays an annual dividend of $1.25 per share and has a dividend yield of 6.6%. Murphy Oil pays an annual dividend of $1.00 per share and has a dividend yield of 4.0%. CNX Midstream Partners pays out 72.7% of its earnings in the form of a dividend. Murphy Oil pays out -55.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Ratings

This is a breakdown of recent recommendations for CNX Midstream Partners and Murphy Oil, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CNX Midstream Partners 0 4 5 0 2.56
Murphy Oil 1 8 2 0 2.09

CNX Midstream Partners presently has a consensus price target of $23.63, suggesting a potential upside of 25.60%. Murphy Oil has a consensus price target of $32.18, suggesting a potential upside of 27.15%. Given Murphy Oil’s higher possible upside, analysts plainly believe Murphy Oil is more favorable than CNX Midstream Partners.

Summary

CNX Midstream Partners beats Murphy Oil on 9 of the 15 factors compared between the two stocks.

CNX Midstream Partners Company Profile

CNX Midstream Partners LP, formerly CONE Midstream Partners LP, is a master limited partnership formed by CONSOL Energy Inc. (CONSOL) and Noble Energy, Inc. (Noble Energy). The Company owns, operates, develops and acquires natural gas gathering and other midstream energy assets to service CONSOL’s and Noble Energy’s production in the Marcellus Shale in Pennsylvania and West Virginia. Its assets include natural gas gathering pipelines and compression and dehydration facilities, as well as condensate gathering, collection, separation and stabilization facilities. It operates through three segments: Anchor Systems, Growth Systems and Additional Systems. Its Anchor Systems include developed midstream systems, including its three midstream systems (the McQuay System, the Majorsville System and the Mamont System) and related assets. Its Growth Systems are located in the dry gas regions of its dedicated acreage.

Murphy Oil Company Profile

Murphy Oil Corporation (Murphy) is an oil and gas exploration and production company. The Company’s exploration and production business explores for and produces crude oil, natural gas and natural gas liquids across the world. Its exploration and production activities are subdivided into four geographic segments: the United States, Canada, Malaysia and all other countries. It explores for and produces crude oil, natural gas and natural gas liquids around the world. This business maintains upstream operating offices in several locations around the world, including Houston, Texas, Calgary, Alberta, and Kuala Lumpur, Malaysia. As of December 31, 2016, Murphy’s principal exploration and production activities were conducted in the United States by Murphy Exploration & Production Company-USA (Murphy Expro USA), in Malaysia, Australia, Brunei, and Vietnam by Murphy Exploration & Production Company-International (Murphy Expro International) and its subsidiaries, and in Western Canada.

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