Williams Partners (NYSE: WPZ) and Eclipse Resources Corporation (NYSE:ECR) are both oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.

Profitability

This table compares Williams Partners and Eclipse Resources Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Williams Partners 17.82% 5.90% 3.03%
Eclipse Resources Corporation -15.86% -5.22% -2.53%

Volatility and Risk

Williams Partners has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500. Comparatively, Eclipse Resources Corporation has a beta of 3.01, indicating that its stock price is 201% more volatile than the S&P 500.

Institutional and Insider Ownership

23.9% of Williams Partners shares are owned by institutional investors. Comparatively, 92.4% of Eclipse Resources Corporation shares are owned by institutional investors. 1.1% of Eclipse Resources Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Williams Partners pays an annual dividend of $2.40 per share and has a dividend yield of 6.2%. Eclipse Resources Corporation does not pay a dividend. Williams Partners pays out 143.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Williams Partners and Eclipse Resources Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Williams Partners $8.00 billion 4.62 $3.78 billion $1.67 23.15
Eclipse Resources Corporation $326.42 million 1.93 $138.82 million ($0.19) -12.63

Williams Partners has higher revenue and earnings than Eclipse Resources Corporation. Eclipse Resources Corporation is trading at a lower price-to-earnings ratio than Williams Partners, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Williams Partners and Eclipse Resources Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Williams Partners 0 3 10 1 2.86
Eclipse Resources Corporation 0 4 5 0 2.56

Williams Partners currently has a consensus target price of $44.67, indicating a potential upside of 15.54%. Eclipse Resources Corporation has a consensus target price of $3.68, indicating a potential upside of 53.29%. Given Eclipse Resources Corporation’s higher probable upside, analysts plainly believe Eclipse Resources Corporation is more favorable than Williams Partners.

Summary

Williams Partners beats Eclipse Resources Corporation on 11 of the 16 factors compared between the two stocks.

Williams Partners Company Profile

Williams Partners L.P. is an energy infrastructure company. The Company has operations across the natural gas value chain from gathering, processing, and interstate transportation of natural gas and natural gas liquids to petchem production of ethylene, propylene, and other olefins. It operates through its Northeast G&P, Atlantic-Gulf, West segment. Under the Northeast G&P segment, it owns and operates fractionation facilities at Moundsville, de-ethanization and condensate facilities at its Oak Grove processing plant. The Atlantic Gulf segment includes the Company’s interstate natural gas pipeline, Transcontinental Gas Pipe Line Company, LLC. The West segment includes its interstate natural gas pipeline, Northwest Pipeline, and natural gas gathering processing and treating operations.

Eclipse Resources Corporation Company Profile

Eclipse Resources Corporation is an independent exploration and production company. The Company is engaged in the acquisition and development of oil and natural gas properties in the Appalachian Basin. The Company is the operator of the Utica Core Area and its Marcellus Project Area. The Ordovician-aged Utica Shale is an unconventional reservoir consisting of organic-rich black shale, with production occurring at vertical depths between 6,000 and 10,000 feet. The Marcellus Shale consists of organic-rich black shale, with production occurring at vertical depths between 5,000 and 8,000 feet. As of December 31, 2016, the Company had commenced drilling 202 gross wells within the Utica Core Area and three gross wells within its Marcellus Area. As of December 31, 2016, it had approximately 92,000 net acres in the Utica Shale in Eastern Ohio within the Utica Core Area. As of December 31, 2016, the Company had assembled an acreage position approximating 199,000 net acres in Eastern Ohio.

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