Critical Analysis: PBF Energy (PBF) and BP p.l.c. (BP)
PBF Energy (NYSE: PBF) and BP p.l.c. (NYSE:BP) are both mid-cap oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.
Risk & Volatility
PBF Energy has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500. Comparatively, BP p.l.c. has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500.
This table compares PBF Energy and BP p.l.c.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider & Institutional Ownership
10.1% of BP p.l.c. shares are held by institutional investors. 2.6% of PBF Energy shares are held by company insiders. Comparatively, 1.0% of BP p.l.c. shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This is a breakdown of current recommendations and price targets for PBF Energy and BP p.l.c., as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PBF Energy currently has a consensus target price of $24.00, indicating a potential downside of 5.73%. BP p.l.c. has a consensus target price of $36.58, indicating a potential upside of 3.56%. Given BP p.l.c.’s stronger consensus rating and higher possible upside, analysts clearly believe BP p.l.c. is more favorable than PBF Energy.
Earnings and Valuation
This table compares PBF Energy and BP p.l.c.’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PBF Energy||$19.03 billion||0.15||$189.02 million||($0.33)||-77.15|
|BP p.l.c.||$209.85 billion||0.55||$19.97 billion||$1.15||30.71|
BP p.l.c. has higher revenue and earnings than PBF Energy. PBF Energy is trading at a lower price-to-earnings ratio than BP p.l.c., indicating that it is currently the more affordable of the two stocks.
PBF Energy pays an annual dividend of $1.20 per share and has a dividend yield of 4.7%. BP p.l.c. pays an annual dividend of $2.38 per share and has a dividend yield of 6.7%. PBF Energy pays out -363.6% of its earnings in the form of a dividend. BP p.l.c. pays out 207.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
BP p.l.c. beats PBF Energy on 12 of the 15 factors compared between the two stocks.
About PBF Energy
PBF Energy Inc. (PBF Energy) is a holding company. The Company is an independent petroleum refiner and supplier of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. The Company operates through two segments: Refining and Logistics. It sells its products throughout the Northeast, Midwest, Gulf Coast and West Coast of the United States, as well as in other regions of the United States and Canada, and ships products to other international destinations. As of December 31, 2016, it owned and operated five domestic oil refineries and related assets. As of December 31, 2016, its refineries had a combined processing capacity, known as throughput, of approximately 900,000 barrels per day (bpd) and a weighted-average Nelson Complexity Index of approximately 12.2. As of December 31, 2016, the Company owned and operated five refineries providing geographic and market diversity.
About BP p.l.c.
BP p.l.c. is an integrated oil and gas company. The Company owns an interest in OJSC Oil Company Rosneft (Rosneft), an oil and gas company. The Company’s segments include Upstream, Downstream, Rosneft, and Other businesses and corporate. The Upstream segment is engaged in oil and natural gas exploration, field development and production, as well as midstream transportation, storage and processing. The Downstream segment has global manufacturing and marketing operations. The Rosneft segment has a resource base of hydrocarbons onshore and offshore. The Other businesses and corporate segment comprises the biofuels and wind businesses, shipping and treasury functions, and corporate activities around the world. The Company provides its customers with fuel for transportation, energy for heat and light, lubricants to keep engines moving and the petrochemicals products used to make everyday items as diverse as paints, clothes and packaging.
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