Nustar GP Holdings (NYSE: NSH) and Nustar Energy L.P. (NYSE:NS) are both oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their profitabiliy, dividends, earnings, risk, analyst recommendations, valuation and institutional ownership.

Institutional & Insider Ownership

56.0% of Nustar GP Holdings shares are owned by institutional investors. Comparatively, 45.4% of Nustar Energy L.P. shares are owned by institutional investors. 21.4% of Nustar GP Holdings shares are owned by insiders. Comparatively, 4.1% of Nustar Energy L.P. shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Nustar GP Holdings and Nustar Energy L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nustar GP Holdings 96.84% 22.15% 19.72%
Nustar Energy L.P. 8.19% 10.56% 3.02%

Dividends

Nustar GP Holdings pays an annual dividend of $2.18 per share and has a dividend yield of 9.1%. Nustar Energy L.P. pays an annual dividend of $4.38 per share and has a dividend yield of 9.7%. Nustar GP Holdings pays out 170.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nustar Energy L.P. pays out 368.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a summary of current recommendations and price targets for Nustar GP Holdings and Nustar Energy L.P., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nustar GP Holdings 1 5 1 0 2.00
Nustar Energy L.P. 0 8 3 0 2.27

Nustar GP Holdings currently has a consensus price target of $28.00, indicating a potential upside of 16.67%. Nustar Energy L.P. has a consensus price target of $49.89, indicating a potential upside of 10.20%. Given Nustar GP Holdings’ higher probable upside, analysts plainly believe Nustar GP Holdings is more favorable than Nustar Energy L.P..

Valuation and Earnings

This table compares Nustar GP Holdings and Nustar Energy L.P.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Nustar GP Holdings $57.19 million 18.02 $54.98 million $1.28 18.75
Nustar Energy L.P. $1.84 billion 2.29 $582.14 million $1.19 38.04

Nustar Energy L.P. has higher revenue and earnings than Nustar GP Holdings. Nustar GP Holdings is trading at a lower price-to-earnings ratio than Nustar Energy L.P., indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Nustar GP Holdings has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500. Comparatively, Nustar Energy L.P. has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.

Summary

Nustar GP Holdings beats Nustar Energy L.P. on 9 of the 16 factors compared between the two stocks.

Nustar GP Holdings Company Profile

NuStar GP Holdings, LLC holds interests in NuStar Energy L.P. (NuStar Energy). NuStar Energy is engaged in the transportation of petroleum products and anhydrous ammonia, the terminalling and storage of petroleum products and the marketing of petroleum products. NuStar Energy has terminal and storage facilities in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, and the United Kingdom. The Company manages NuStar Energy through its ownership of NuStar GP, LLC and Riverwalk Holdings, LLC, which own Riverwalk Logistics L.P., the general partner of NuStar Energy.

Nustar Energy L.P. Company Profile

NuStar Energy L.P. is engaged in the transportation of petroleum products and anhydrous ammonia; the terminalling and storage of petroleum products, and the marketing of petroleum products. The Company’s segments include pipeline, storage and fuels marketing. The pipeline segment consists of the transportation of refined petroleum products, crude oil and anhydrous ammonia. The storage segment consists of facilities that provide storage, handling and other services for petroleum products, crude oil, specialty chemicals and other liquids. The fuels marketing segment involve the purchase of crude oil, fuel oil, bunker fuel, fuel oil blending components and other refined products for resale. It conducts its operations through its subsidiaries, primarily NuStar Logistics, L.P. and NuStar Pipeline Operating Partnership L.P. As of May 4, 2017, it had more than 9,200 miles of pipeline and 81 terminal and storage facilities that provide approximately 96 million barrels of storage capacity.

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