Energy Transfer LP Unit (NYSE:ET) and Transportadora de Gas del Sur (NYSE:TGS) are both oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.
Institutional & Insider Ownership
57.0% of Energy Transfer LP Unit shares are held by institutional investors. Comparatively, 9.1% of Transportadora de Gas del Sur shares are held by institutional investors. 3.3% of Energy Transfer LP Unit shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares Energy Transfer LP Unit and Transportadora de Gas del Sur’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Energy Transfer LP Unit||$54.09 billion||0.72||$1.66 billion||$1.15||12.97|
|Transportadora de Gas del Sur||$918.84 million||2.67||$405.26 million||$1.95||8.02|
Energy Transfer LP Unit has higher revenue and earnings than Transportadora de Gas del Sur. Transportadora de Gas del Sur is trading at a lower price-to-earnings ratio than Energy Transfer LP Unit, indicating that it is currently the more affordable of the two stocks.
This table compares Energy Transfer LP Unit and Transportadora de Gas del Sur’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Energy Transfer LP Unit||4.03%||7.61%||2.65%|
|Transportadora de Gas del Sur||33.04%||55.91%||22.56%|
Energy Transfer LP Unit pays an annual dividend of $1.22 per share and has a dividend yield of 8.2%. Transportadora de Gas del Sur pays an annual dividend of $1.54 per share and has a dividend yield of 9.9%. Energy Transfer LP Unit pays out 106.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Transportadora de Gas del Sur pays out 79.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Transportadora de Gas del Sur is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a breakdown of current ratings and recommmendations for Energy Transfer LP Unit and Transportadora de Gas del Sur, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Energy Transfer LP Unit||0||1||5||0||2.83|
|Transportadora de Gas del Sur||0||0||1||0||3.00|
Energy Transfer LP Unit presently has a consensus target price of $19.50, indicating a potential upside of 30.78%. Given Energy Transfer LP Unit’s higher probable upside, equities research analysts clearly believe Energy Transfer LP Unit is more favorable than Transportadora de Gas del Sur.
Volatility and Risk
Energy Transfer LP Unit has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500. Comparatively, Transportadora de Gas del Sur has a beta of 0.5, meaning that its stock price is 50% less volatile than the S&P 500.
About Energy Transfer LP Unit
Energy Transfer LP provides energy-related services in the United States and China. The company owns and operates approximately 9,400 miles of natural gas transportation pipelines and three natural gas storage facilities in Texas; and approximately 12,200 miles of interstate natural gas pipelines. It sells natural gas to electric utilities, independent power plants, local distribution companies, industrial end-users, and other marketing companies. The company owns and operates natural gas gathering and natural gas liquid (NGL) pipelines, processing plants, treating facilities, and conditioning facilities in Texas, New Mexico, West Virginia, Pennsylvania, Ohio, and Louisiana; natural gas gathering, oil pipeline, and oil stabilization facilities in South Texas; a natural gas gathering system in Ohio; and transportation and supply of water to natural gas producers in Pennsylvania. It also owns approximately 4,769 miles of NGL pipelines; NGL and propane fractionation facilities; NGL storage facilities with working storage capacity of approximately 45 million barrels (Bbls); and other NGL storage assets and terminals with an aggregate storage capacity of approximately 11 million Bbls. The company also sells gasoline, middle distillates, and motor fuel at retail, as well as crude oil, NGLs, and refined products; operates convenience stores; and distributes motor fuels and other petroleum products. It provides natural gas compression services; carbon dioxide and hydrogen sulfide removal, natural gas cooling, dehydration, and British thermal unit management services; and manages coal and natural resources properties, as well as sells standing timber, leases coal-related infrastructure facilities, collects oil and gas royalties, and generates a total of 75 megawatts electrical power. The company was formerly known as Energy Transfer Equity, L.P. and changed its name to Energy Transfer LP in October 2018. Energy Transfer LP was founded in 2002 and is based in Dallas, Texas.
About Transportadora de Gas del Sur
Transportadora de Gas del Sur S.A. provides natural gas transportation and distribution services in Argentina. The company operates through four segments: Natural Gas Transportation, Liquids Production and Commercialization, Other Services, and Telecommunications. The Natural Gas Transportation segment transports natural gas through 5,706 miles of pipeline system to distribution companies, power plants, and industrial customers. As of December 31, 2017, it served 6.1 million residential, commercial, industrial, and electric power generation end-users. It also provides operation and maintenance services for the natural gas transportation facilities. The Liquids Production and Commercialization segment produces and commercializes natural gas liquids, such as ethane, LPG, natural gasoline, propane, and butane in Argentina and internationally. The Other Services segment offers midstream services, including natural gas treatment, separation, and removal of impurities from the natural gas stream, as well as natural gas compression. It also provides services related to pipeline and compression plant construction, operation, and maintenance; and generates steam for electricity production. The Telecommunications segment provides telecommunication services for telecommunication operators and corporate customers. Its telecommunication network includes a microwave digital network with synchronous digital hierarchy technology and a dark fiber optic network. The company was founded in 1992 and is headquartered in Buenos Aires, Argentina. Transportadora de Gas del Sur S.A. is a subsidiary of Compañía de Inversiones de Energía S.A.
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