Phillips 66 Partners (NYSE: PSXP) and Plains Group Holdings, L.P. (NYSE:PAGP) are both mid-cap energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Volatility & Risk

Phillips 66 Partners has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500. Comparatively, Plains Group Holdings, L.P. has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Phillips 66 Partners and Plains Group Holdings, L.P., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Phillips 66 Partners 1 1 9 0 2.73
Plains Group Holdings, L.P. 0 9 9 0 2.50

Phillips 66 Partners presently has a consensus target price of $57.13, suggesting a potential upside of 21.18%. Plains Group Holdings, L.P. has a consensus target price of $27.50, suggesting a potential upside of 21.79%. Given Plains Group Holdings, L.P.’s higher possible upside, analysts clearly believe Plains Group Holdings, L.P. is more favorable than Phillips 66 Partners.

Profitability

This table compares Phillips 66 Partners and Plains Group Holdings, L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Phillips 66 Partners 52.28% 11.11% 9.96%
Plains Group Holdings, L.P. 0.34% 0.69% 0.30%

Earnings and Valuation

This table compares Phillips 66 Partners and Plains Group Holdings, L.P.’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Phillips 66 Partners $781.00 million 6.67 $461.00 million $2.43 19.40
Plains Group Holdings, L.P. $23.87 billion 0.15 $1.92 billion $0.66 34.23

Plains Group Holdings, L.P. has higher revenue and earnings than Phillips 66 Partners. Phillips 66 Partners is trading at a lower price-to-earnings ratio than Plains Group Holdings, L.P., indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

43.0% of Phillips 66 Partners shares are held by institutional investors. Comparatively, 83.2% of Plains Group Holdings, L.P. shares are held by institutional investors. 39.9% of Plains Group Holdings, L.P. shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Phillips 66 Partners pays an annual dividend of $2.46 per share and has a dividend yield of 5.2%. Plains Group Holdings, L.P. pays an annual dividend of $2.20 per share and has a dividend yield of 9.7%. Phillips 66 Partners pays out 101.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Plains Group Holdings, L.P. pays out 333.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Phillips 66 Partners has raised its dividend for 3 consecutive years and Plains Group Holdings, L.P. has raised its dividend for 2 consecutive years.

Summary

Phillips 66 Partners beats Plains Group Holdings, L.P. on 9 of the 16 factors compared between the two stocks.

About Phillips 66 Partners

Phillips 66 Partners LP (Phillips 66) owns, operates, develops and acquires fee-based crude oil, refined petroleum product and natural gas liquids (NGL) pipelines, terminals and other transportation and midstream assets. The Company’s assets consist of systems, such as Clifton Ridge Crude System, Eagle Ford Gathering System, Ponca Crude System, Billings Crude System, Borger Crude System, Sweeny to Pasadena Products System, Hartford Connector Products System, Gold Line Products System, Cross-Channel Connector Products System, Ponca Products System, Billings Products System, Bayway Products System, Standish Pipeline, Borger Products System, River Parish NGL System, Medford Spheres, Bayway Rail Rack, Ferndale Rail Rack, Sand Hills/Southern Hills Joint Ventures, Explorer Pipeline Joint Venture, Bakken Joint Ventures, Bayou Bridge Pipeline Joint Venture, STACK Pipeline Joint Venture, and Sweeny Fractionator and Clemens Caverns.

About Plains Group Holdings, L.P.

Plains GP Holdings, L.P. owns and operates midstream energy infrastructure and provides logistics services for crude oil, natural gas liquids (NGL), natural gas and refined products. The Company operates through three segments: Transportation, Facilities, and Supply and Logistics. Through its three business segments, the Company is engaged in the transportation, storage, terminaling and marketing of crude oil, NGL and natural gas. The Transportation segment operations consist of fee-based activities associated with transporting crude oil and NGL on pipelines, gathering systems, trucks and barges. The Facilities segment operations consist of fee-based activities associated with providing storage, terminaling and throughput services for crude oil, refined products, NGL and natural gas, as well as NGL fractionation and isomerization services and natural gas and condensate processing services. The Supply and Logistics segment operations consist of the merchant-related activities.

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