Blueknight Energy Partners L.P., L.L.C. (NASDAQ: BKEP) and Southcross Energy Partners, L.P. (NYSE:SXE) are both small-cap oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.

Earnings and Valuation

This table compares Blueknight Energy Partners L.P., L.L.C. and Southcross Energy Partners, L.P.’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Blueknight Energy Partners L.P., L.L.C. $183.18 million 1.23 $65.50 million ($0.13) -45.38
Southcross Energy Partners, L.P. $627.73 million 0.29 $59.78 million ($1.45) -1.60

Blueknight Energy Partners L.P., L.L.C. has higher revenue, but lower earnings than Southcross Energy Partners, L.P.. Blueknight Energy Partners L.P., L.L.C. is trading at a lower price-to-earnings ratio than Southcross Energy Partners, L.P., indicating that it is currently the more affordable of the two stocks.

Dividends

Blueknight Energy Partners L.P., L.L.C. pays an annual dividend of $0.58 per share and has a dividend yield of 9.8%. Southcross Energy Partners, L.P. does not pay a dividend. Blueknight Energy Partners L.P., L.L.C. pays out -446.2% of its earnings in the form of a dividend. Southcross Energy Partners, L.P. has increased its dividend for 3 consecutive years.

Profitability

This table compares Blueknight Energy Partners L.P., L.L.C. and Southcross Energy Partners, L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Blueknight Energy Partners L.P., L.L.C. 12.71% -12.45% 7.23%
Southcross Energy Partners, L.P. -16.46% -18.51% -8.84%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Blueknight Energy Partners L.P., L.L.C. and Southcross Energy Partners, L.P., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Blueknight Energy Partners L.P., L.L.C. 0 0 1 0 3.00
Southcross Energy Partners, L.P. 0 0 0 0 N/A

Blueknight Energy Partners L.P., L.L.C. presently has a consensus price target of $7.20, suggesting a potential upside of 22.03%. Given Blueknight Energy Partners L.P., L.L.C.’s higher possible upside, equities research analysts clearly believe Blueknight Energy Partners L.P., L.L.C. is more favorable than Southcross Energy Partners, L.P..

Insider and Institutional Ownership

57.5% of Blueknight Energy Partners L.P., L.L.C. shares are held by institutional investors. Comparatively, 2.5% of Southcross Energy Partners, L.P. shares are held by institutional investors. 1.7% of Blueknight Energy Partners L.P., L.L.C. shares are held by company insiders. Comparatively, 23.8% of Southcross Energy Partners, L.P. shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

Blueknight Energy Partners L.P., L.L.C. has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Southcross Energy Partners, L.P. has a beta of 4.2, indicating that its share price is 320% more volatile than the S&P 500.

Summary

Blueknight Energy Partners L.P., L.L.C. beats Southcross Energy Partners, L.P. on 11 of the 15 factors compared between the two stocks.

About Blueknight Energy Partners L.P., L.L.C.

Blueknight Energy Partners, L.P. is a master limited partnership company. The Company manages its operations through four segments: asphalt terminaling services, crude oil terminaling and storage services, crude oil pipeline services, and crude oil trucking and producer field services. Asphalt terminaling services segment operations generally consist of fee based activities associated with providing storage, terminaling and throughput services for asphalt product and residual fuel oil. Crude oil terminaling and storage segment operations generally consist of fee based activities associated with providing storage, terminaling, and throughput services for crude oil. Crude oil pipeline services segment operations generally consist of fee-based activity associated with transporting crude oil products on pipelines. Crude oil trucking and producer field services segment operations generally consist of fee-based activity associated with transporting crude oil products on trucks.

About Southcross Energy Partners, L.P.

Southcross Energy Partners, L.P. provides natural gas gathering, processing, treating, compression and transportation services and natural gas liquid (NGL) fractionation and transportation services. The Company also sources, purchases, transports and sells natural gas and NGLs. Its assets are located in South Texas, Mississippi and Alabama As of December 31, 2016, its assets consisted of gathering systems, intrastate pipelines, two natural gas processing plants, one fractionation facility, 20 compressor stations and a treating system. Its gathering systems and intrastate pipelines include South Texas and Mississippi/Alabama. The assets in its South Texas region are located between Montgomery County, which is north of Houston, and Webb and Dimmit Counties near the Texas-Mexico border. The assets in its Mississippi region are located principally in the southern half of the state and consist of intrastate pipeline system in Mississippi.

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